The Matanuska-Susitna Borough (Mat-Su) has the potential to become Alaska’s leading center for data and industrial investment, driven by modern energy development and the strategic location of Port MacKenzie.

Addressing Alaska's Energy Needs

Historically, energy proposals in Alaska have faced immediate opposition, with concerns raised about environmental impacts. While some scrutiny is warranted, others deserve consideration for their potential benefits. Alaska requires a dependable power supply for its residents, businesses, and growing industries.

Resource Development and Modern Technology

The Mat-Su area is already designated for resource development, with existing coal leases and land allocated for industrial use. Proposals like facilities with carbon capture shouldn’t be dismissed outright. These represent an effort to utilize local resources with advanced technology to generate reliable electricity.

The Potential of Biomass and Coal with Carbon Capture

A recent University of Alaska Fairbanks (UAF) study examined the feasibility of a 75 or 300 megawatt biomass and coal facility equipped with carbon capture technology. The study found that electricity generated from such a plant could be competitive with new natural gas generation, particularly as Cook Inlet gas supplies diminish and reliance on imported LNG increases.

The estimated investment ranges from $1 billion to $3.6 billion. Federal incentives for carbon storage could offset some of the long-term costs. Local coal and biomass are estimated at $4 per million BTU, significantly lower than the $7 to $30 range for natural gas in Southcentral Alaska.

With carbon capture rates of 90% to 95%, emissions could be lower than those from existing gas plants. This approach could also preserve remaining Cook Inlet gas for residential heating while providing a stable baseload power source.

Data Centers and Power Demand

Large data centers, requiring constant and substantial electricity – often hundreds of megawatts – are a key component of this vision. Alaska’s cold climate offers advantages for cooling, but these facilities depend on a consistent power supply.

A dedicated power supply could be established through long-term agreements or a dedicated transmission line. Industrial customers would cover the infrastructure costs, avoiding impacts on residential ratepayers. Excess power could be sold to utilities through power purchase agreements.

Economic Benefits for Mat-Su

This approach could attract several data centers and billions of dollars in private investment. Alaska seeks jobs, a robust revenue base, and an economy less reliant on oil. Mat-Su Borough, with its existing industrial infrastructure at Port MacKenzie, is well-positioned to capitalize on this opportunity.

While data centers don’t create massive long-term employment, construction generates significant workforce demand and provides substantial property tax revenue. Regions like Loudoun County, Virginia, have demonstrated the economic benefits of data center investment.

Addressing Concerns and Moving Forward

Concerns regarding carbon capture technology are often based on outdated perceptions. Modern systems can remove a significant portion of carbon dioxide before it enters the atmosphere. The UAF study suggests lifecycle emissions could be lower than those from imported LNG.

Other concerns, such as strain on the Railbelt grid and water usage, are also being addressed. Newer data centers utilize air cooling and water recycling systems, and water use is reviewed during the permitting process.

Diversifying energy sources is crucial, as natural gas prices are expected to rise as production declines. Coal and biomass offer a stable, local fuel supply, and with federal incentives, coal with carbon capture can compete with new gas plants.

Representative David Rauscher of Big Lake emphasizes the need for fair evaluation, clear rules, and evidence-based decision-making. The UAF analysis provides a starting point for considering clean coal with carbon capture as a viable option for powering data centers and strengthening the Mat-Su economy.

It’s time to shift from saying “No, because” to “Yes, but,” and embrace the opportunities that could support Alaskan communities for decades to come.