Transcript Energy and Rural Alaska

Energy and Rural Alaska Economic
Development
Steve Colt, University of Alaska Anchorage
email [email protected]
presented to
Utility Wind Interest Group
May 23, 2000
Statewide Economic
Outlook:
On the Surface,
• Positive Signs
• People Feel Good
• Future Looks Positive
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Economic Indicators
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•
•
•
•
•
Jobs
Wage Rate
Personal Income
Per Capita Income
Value Added (GSP)
Population
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JOBS: Growth Rate Down
7%
6%
5%
4%
3%
2%
1%
0%
60-70
70-80
Alaska
80-90
90-98
US Avg
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BASIC JOBS: 4,000 Lost since 1990
-6,000
-4,000
-2,000
0
2,000
4,000
TOURISM
AIR CARGO
6,000
4,600
890
SEAFOOD
420
MINING
380
1,810 OIL AND GAS
2,340
1,390
5,080
TIMBER
FED CIVILIAN
MILITARY
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AVERAGE REAL WAGE: Down
$44,000
$42,000
1998 $
$40,000
$38,000
$36,000
$34,000
$32,000
$30,000
80
82
84
86
88
90
92
94
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96
98
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REAL PERSONAL INCOME:
Growth Rate Down
9%
8%
7%
6%
5%
4%
3%
2%
1%
0%
60-70
70-80
Alaska
80-90
90-98
US Avg
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Total REAL INCOME:
Growth Since 1990
LABOR
INCOME
$78
INVESTMENT
INCOME
$251
PF DIVIDEND
$154
OTHER GOVT
TRANSFERS
$659
-$500
$0
$500
$1,000 $1,500 $2,000 $2,500 $3,000
Millions of 1998 $
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PER CAPITA PERSONAL INCOME:
Now Below U.S. Average
60%
% Alaska Above US Avg
50%
40%
30%
20%
10%
0%
-10%
-20%
80
82
84
86
88
90
92
94
96
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NON-OIL Value-Added:
Growth Rate Down
8%
average annual growth
7%
6%
5%
4%
3%
2%
1%
0%
60-70
70-80
Alaska
80-90
90-98
US Avg
Institute of Social and Economic Research, University of Alaska Anchorage
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POPULATION:
Cumulative Change in the 1990s
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
over 40
under 40
Anchorage
US Avg
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The Post-Prudhoe Blues
Market Value of Oil and Other Production
$25,000
$20,000
Oil and Gas
Million 1998 $
Seafood
Mining
$15,000
$10,000
$5,000
$0
70
75
80
85
90
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What About Rural Alaska?
• Shift from State to Federal Funding
• Shift from Govt to “Services”
employment (nonprofits, tribes)
• Shift from Municipal to Tribal govt
• Continuing Rapid Population Growth
– (2-3%)
• Struggle to retain fisheries wealth
• Cautious embrace of tourism
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High Wind Communities
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•
•
•
Class 6 and 7
Coastal
Treeless
Small -- average population 387
– (excluding Unalaska)
• Some have Fish Resources
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Per Capita Personal Income:
Alaska vs. High-Wind Communities
30,000
25,000
30,000
25,000
20,000
15,000
10,000
Alaska
9,500
Anchorage
Class67
5,000
0
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Fuel Cost per kWh: Anchorage vs.
High-Wind Communities
10
9
cents per kWh
8
6
4
2
0
2
Anchorage
Class67
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Components of Diesel Cost
•
•
•
•
•
Crude oil = $.35
Refining = $.25
Bulk Barge = $.10-.30
Inland Transport = $.00 - $1.00
Bulk Storage = $.10-.20 cents
• Total = $.80 - $2.10
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NonFuel Cost per kWh
30
27.5
cents per kWh
25
20
17
15
10
8
5
0
Anchorage
Class67
AVEC
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Rural vs.(?) Urban Energy Projects
• Through 1993, urban projects cost
about twice as much as rural projects
plus PCE.
In any Event,
• About 75% of rural energy project
dollars flow to urban areas. (weatherization)
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Energy Projects and Jobs
• The conventional energy system
supports significant employment.
– Little of the total cost goes out-ofstate
Hence,
• Real job creation comes from a lower
cost (not price!) of living and doing
business, not from one-time
construction impacts.
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Four Types of Feasibility
• Technical -- Performs according to
design, designed for Alaska
• Economic -- beats avoided cost of
diesel
• Locational -- resilience against normal
disruption
• Human Resource / Administrative
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Which Comes First?
• Projects drive Community
Development and develop capacity
Or,
• Community Capacity Enables Projects
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