Kachemak Bay
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Photo: NASA Earth Observatory images by Michala Garrison, using Landsat data from the U.S. Geological Survey. Story by Adam Voiland. via Wikimedia Commons · Photo source · Public domain
Comment closes on giving the energy authority state land at Bradley Lake at no cost
Public comment closed Tuesday on the state's plan to give the Alaska Energy Authority about 5,805 acres at the Bradley Lake hydroelectric project at no cost, a transfer the authority's director told the governor's office would support financing for the plant's planned expansion.
The land, about nine square miles roughly 23 miles northeast of Homer, covers most of the dry land the authority already leases for the hydro plant, plus land for its Battle Creek diversion and the planned expansion. The Department of Natural Resources will now weigh the comments and issue a final decision, which it can do without further notice if no significant changes are needed.
Bradley Lake has run since 1991 and supplies about 10% of the Railbelt's power, from Homer to Fairbanks, according to the department's preliminary decision. The authority wants to make it bigger. Its Dixon Diversion would send glacier meltwater through a 4.6-mile tunnel into the lake and raise the lake about 16 feet, adding about 167,000 megawatt-hours a year, a 38% increase, the authority's board has been told. The authority told legislators in August that the expansion would add enough electricity for about 30,000 homes and offset about 1.5 billion cubic feet of natural gas a year.
The lake was about 1,486 acres before the dam. It's about 3,802 acres now and would grow to about 4,033, the decision says.
The authority's board materials put the total cost at about $435 million, including $401 million for construction. The price has been stated several ways since spring. Railbelt electric customers will repay up to $100 million in short-term borrowing that must be refinanced by mid-2028, and the authority is pursuing federal tax credits.
That's where the land comes in. "Following up on a conversation with the Governor," Curtis Thayer, the authority's executive director, sent the governor's office a letter in May requesting the transfer, which he wrote "will support our FERC amendment and the financing of the Dixon Diversion," according to an email posted among legislative documents.
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Latest
October 2026
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About Kachemak Bay
Kachemak Bay is an estuary on the Kenai Peninsula in Southcentral Alaska, with Homer on one shore and a roadless south shore across the water. Kachemak Bay State Park, Halibut Cove, Kachemak Selo and China Poot Bay lie around it.
The bay supports commercial and sport fishing, shellfish farming and local harvests such as the sockeye and clams at China Poot Bay, where clammers need a permit. A NOAA and University of Alaska Fairbanks marine lab studies its waters for ocean acidification, algal blooms and shellfish. Homer's harbor, trails in the state park and searches for people on the water and in the hills nearby recur.
Infrastructure crosses the bay to the south shore communities, including an undersea power cable corridor that Homer Electric is converting into a fiber optic route for broadband. The Bradley Lake hydroelectric project lies near Homer, on state land set aside for the Alaska Energy Authority.
More from Kachemak Bay
June 2026
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May 2026
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