Northwest Arctic Borough energy plan finds fuel use down 2.1%, short of 10% goal

The Northwest Arctic Borough cut imported fuel use 2.1% from 2008 to 2024, short of its goal of a 10% cut by 2020, according to a regional energy plan dated Sept. 14.

The plan projects that the borough will miss its 2030 goal too. Projects already under way should cut use 13.4% by 2030, it says, and adding possible new projects such as Kogoluktuk River hydro would bring the cut to 31.3% by 2040. The goals are 25% by 2030 and 50% by 2050. The projections do not account for growth in buildings or electricity demand.

Diesel burned for electricity fell about 7.7%. But estimated heating oil use rose from about 2.61 million to 2.70 million gallons, and electricity use grew more than 5%. The plan says the borough's population has not changed significantly since 2008.

The plan carries forward goals from the borough's 2022 Regional Energy Plan, which called the 2020 goal "accomplished." It covers all 11 borough communities and was paid for by a federal climate planning grant passed through Tanana Chiefs Conference.

The region burns nearly 5 million gallons of heating oil and power-plant diesel a year, at an average of at least $8 a gallon in 2025, the plan says. Spending now tops the 2022 estimate of more than $30 million a year, with heating oil alone over $21 million.

Community Fuel and Power Prices

The plan lists 2026 stove oil prices but gives no source or month for them: Kivalina at $6.78 a gallon, Buckland at $7.13, Selawik at $7.72, Noorvik at $7.95, Deering at $8.75, Kotzebue at $8.99, Kiana at $9.53, Noatak at $10.75, Shungnak at $10.91, Kobuk at $12.60 and Ambler at $27.60. The state's Summer 2026 heating fuel survey, which covers four of the 11 communities, lists higher prices for two of them: Kotzebue at $9.38 and Kiana at $11.59. Noatak, Shungnak, Kobuk and at times Ambler cannot be reached by barge, the plan says, so their fuel is flown in.

After the state's Power Cost Equalization (PCE) subsidy, electricity runs 20 to 28 cents a kilowatt-hour except in Noatak, where it costs 46 cents ($1.16 before the subsidy), the plan says. "Unfortunately, the PCE program does not provide support for heating, which is typically reliant upon expensive heating oil," it says.

The plan prices the options under consideration:

• Solar with batteries: about $8,000 to $10,000 per kilowatt

• Heat pumps: $8,000 to $10,000 each

• Wind: $10 million per megawatt turbine

• Power lines between villages: $15 million to $25 million each

• Kogoluktuk River hydro: more than $80 million and more than five years away

A U.S. Department of Energy Office of Clean Energy Demonstrations (OCED) grant is set to put solar and batteries in seven communities from 2026 to 2029 and fund more than 800 heat pumps.

Funding Shortfall and Project Progress

The borough Energy Department's Sept. 8 report, in the Assembly's September packet, says the grant money will not cover all the planned work. "We have shortfalls in the OCED budget and at this time do not have enough funding to complete the Solar PV build out and Heat pumps for all communities," it says.

The report does not give the size of the shortfall. It proposes using incoming federal tax credit returns to finish the work.

The report says U.S.-Iran tension is likely to raise fuel costs as much as 60%. Electricity rates, unchanged since September 2025, are expected to rise as much as 50% by July, it says, calling it "a very serious situation for our communities with everything rising in cost."

The first heat pump pilot, in Deering, had five units installed, the report says. Selawik's 700-kilowatt solar and battery project is under contract for completion this year. Ambler's solar and power plant control projects have slipped to 2027 and 2028 because Alaska Village Electric Cooperative equipment did not meet federal Build America, Buy America rules and must be reordered.

The Assembly took no action on the plan Sept. 22. It is next scheduled to meet Nov. 23 and 24.