Federal departments announce about $280m in funding for Alaska projects

Three departments of the U.S. government have announced they have awarded about $280 million in new funding for transportation and energy projects in Alaska, money made available through the Infrastructure Investment and Jobs Act of 2021 and the Inflation Reduction Act of 2022.

In its announcement, the U.S. Department of Transportation said on Wednesday that it is sending about $54 million, with the funds made possible by the bipartisan 2021 infrastructure bill, to three Alaska projects.

One project, to get $25 million, is for restoring about 45 miles of the Alaska Highway that has been degraded by permafrost thaw and other climate change impacts, the department said. Another $25 million will go to the City and Borough of Wrangell for a project revitalizing the harbor, the department said. The project involves the design and construction of floating and anchoring systems, water, electrical and fire-suppression systems and relocation of parking, the department said. The third project, which is getting just under $4 million, is for port planning, permitting and design work in the Yukon River village of Nulato, the department said.

The Alaska transportation grants are among the $1.8 million in awards across the nation announced on Wednesday. The grants are from the department’s Rebuilding American Infrastructure with Sustainability and Equity program.

Separately, the U.S. Department of the Interior announced that Alaska will receive $25 million to plug and clean oil and gas wells drilled in the past and then abandoned.

Alaska is among five states receiving a total of $127 million for that purpose, Interior said in its announcement. That money is also available through the Infrastructure Investment and Jobs Act.

These inactive and gas wells are known as “orphaned wells,” since they have been abandoned by the companies that drilled them. There are millions of orphaned wells across the country. Many remain unplugged and are releasing pollutants into the air and the groundwater.

The money for Alaska is to address wells located on state or private land. As of April, there were 46 identified orphaned wells on state or private land, according to the Alaska Oil and Gas Conservation Commission, the agency managing the issue.

The oldest orphaned wells on the AOGCC list date back to the early 1900s, when Alaska’s first oil wells were drilled at Katalla, a Gulf of Alaska coastal site about 50 miles southeast of Cordova.

Work on several wells is already underway. An Arctic Slope Regional Corp. subsidiary, ASRC Consulting and Environmental Services, has been contracted to do plugging and remediation work and submitted a progress report in January.

Another $200 million in money from the Inflation Reduction Act, a bill that passed Congress without any Republicans voting in support, will go to battery energy storage systems in Interior Alaska and on the Kenai Peninsula, the U.S. Department of Agriculture announced separately on Wednesday.

The Alaska projects getting the $100 million in funding apiece are a 46-megawatt battery energy storage system to be built by Fairbanks-based Golden Valley Electric Association and a 45-megawatt four-hour battery energy storage system to be installed in Soldotna by the Alaska Electric and Energy Cooperative Inc., a subsidiary of Homer Electric Association.

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