The board of Homer Electric Association, or HEA, unanimously approved a purchase contract on Aug. 13 with Renewable IPP, a power producer that’s built several large solar farms in the state.
Jenn Miller is the CEO of Renewable IPP. She said the company is working to give Alaskans energy options beyond natural gas.
“When we started the company, our mission was to not only diversify Alaska’s energy generation mix, but to do it in a way that actually reduces energy costs for Alaskans,” Miller said.
The path to get the project approved is years in the making.
Renewable IPP has been working with HEA to build a solar farm on the Kenai Peninsula since 2021. They previously considered a site in Sterling before settling on the current location. Miller said they expect to finish construction by 2028.
“While folks might say, ‘Man, can’t you move faster?’” she said, “you know, we spent three years working it, and I think without that level of due diligence, you wouldn’t have a project that delivers value on so many fronts like you do with this Puppy Dog Lake Project.”
The Puppy Dog Lake Project in Nikiski would be the largest solar farm in Alaska. Once it’s built, the farm could produce up to 30 megawatts, which is enough to power about 9,000 homes where the average household uses about 550 kilowatt hours a month. Renewable IPP also built the state’s current largest solar farm in Houston, which produces 8.5 megawatts of electricity — less than a third of the power the Nikiski project is expected to.
The purchase agreement comes as Alaska’s railbelt faces a looming shortage of natural gas, with utilities looking for ways to import natural gas.
Since Renewable IPP set its sights on the peninsula, the Kenai Peninsula Borough Assembly also approved property tax exemptions for independent power producers.
The new solar farm would double the amount of renewable energy the region uses from about 12% to 24%, according to HEA. Keriann Baker oversees strategy for the utility, and she said the contract will allow them to purchase electricity for less than what they currently pay for power. But, Baker said the utility continues to support developing natural gas.
“We’d like to see some policies like royalty relief that makes it easier for producers here, because a strong and thriving natural gas environment is healthy for everyone, but at the same time, we also want to protect our members responsibly from the volatility that we’re seeing in the fuel market, and we want to diversify,” she said, “we just don’t want to do it in a way that provides rate shock to our members.”
In addition to solar energy, the board also approved replacing an old, inefficient gas turbine at the power plant in Nikiski. The utility doesn’t expect the replacement to happen until late 2027 or early 2028. Once both projects are online, Baker said they could cut about one sixth of the natural gas currently being used.
HEA’s board threw out its old energy portfolio goal at the end of last year, which was to have 50% of energy coming from renewable sources by 2025. They updated the utility’s strategic plan to simply diversify its energy sources instead.
Baker said HEA is looking at other renewable energy sources outside of solar to accomplish that at the lowest cost to ratepayers.
“Really it’s anything right now. We’ve talked to tidal groups. We’ve talked to geothermal groups. We’ve talked to nuclear groups. We’ve talked to wind groups. I mean, we really are an all of the above utility,” She said.
HEA currently has an agreement with GeoAlaska, which is collecting data on Augustine Island to see if it’s possible to connect geothermal energy to the peninsula and beyond.
While the project and contract costs aren’t public until both parties finalize paperwork with the Regulatory Commission of Alaska, Miller said they received a $2 million grant from the Alaska Energy Authority that’s bringing down overall costs for ratepayers. They expect to finish the filing in the next couple months.