FAIRBANKS, Ak -- The Fairbanks North Star Borough officially unveiled their supply–side neutral Gas Distribution System Analysis report today.
After years of study, the findings add up to huge savings for the Interior with the large scale introduction of natural gas.
The study released by the Fairbanks North Star Borough assumes natural gas will be available for the Interior market in the coming years.
The focus of the report is not where the gas will come from, but the potential savings to the community if a distribution system is ready in time.
"2021 is the first full year of operations for the system where we have the natural gas pipe distribution system in, plus the availability of propane for the low density areas and our estimates for 2021 is the Borough, the residents and the businesses in the Borough, would save about $315 million dollars a year" said Pat Burden of Northern Economics who produced the analysis.
$300 million-plus in savings annually, and that figure does factor in the large cost for residential homes and commercial businesses to convert their space heating units to run on what would be an ample supply of natural gas.
"The average cost to convert would be about $8,000 per residential structure," Burden said.
The study also provides analysis of the impact natural gas would have on air quality.
While not including industrial power plant operations and their emissions, the analysis shows the Fairbanks non–attainment area for PM 2.5 particulate pollution could be dramatically reduced by up to 95 percent.
"This conversion of residential and commercial to gas would be a big step in reducing PM 2.5 in the community, but there are, in fact, other emmiters that also need to be examined as a part of an overall study," said Al Trbovich of SLR Environmental.
The analysis report does not weigh in on what location natural gas will ultimately be supplied from, but the report does weigh in on the options of ultimately who will manage gas distribution in the Borough.
And the choices are many, a completely privatized operation, a non–profit or public utility exchange, a partnership between a public entity and private industry, or state involvement.
Each has their pros and cons, measured by SWOT, or Strengths, Weaknesses, Opportunities and Threats.
State partnership, the report concludes, would be most likely to achieve the lowest costs, for the broadest service area, within five years or less.
Regardless of business model, the Gas Distribution Analysis reveals substantial savings of energy. Home heating costs could decline to the tune of 60 percent savings annually.
The larger question still looms: Who, at the end of the day, will manage and ultimately control the future of natural gas in the Fairbanks North Star Borough.