Bold truth: duplicating two LNG import projects in Southcentral Alaska could raise utility bills for everyday Alaskans, yet the reality and potential costs are not as simple as they seem. Here’s a clear, beginner-friendly rewrite that preserves every key detail, while expanding a bit for context and readability. And yes, this version stays faithful to the original meaning, just in fresh wording.
Alaska lawmakers and regulators are scrutinizing whether building two separate LNG import facilities in Southcentral Alaska is necessary, given the potential impact on ratepayers. The Regulatory Commission of Alaska has opened an investigation to gather information from Enstar Natural Gas and Chugach Electric Association about their plans for these two distinct projects. This inquiry aims to determine if both facilities are truly needed, or if one could sufficiently meet the region’s gas needs as local Cook Inlet production declines in the coming years.
Enstar, the main natural gas provider in Southcentral Alaska, has been collaborating with Glenfarne. Glenfarne is pursuing the construction of a new LNG import facility in Nikiski and is also behind the Alaska LNG megaproject, which envisions transporting North Slope gas to Alaska’s cities and for export, should the project move forward.
Separately, Chugach Electric, which serves as Alaska’s largest electric utility, has indicated its interest in purchasing gas from Harvest Midstream, an affiliate of Hilcorp. Harvest is proposing to convert a former LNG export facility in Nikiski into an LNG import operation. If realized, this would establish a second Nikiski project.
Both proposed facilities carry multi-hundred-million-dollar price tags, underscoring the substantial financial implications involved.
The RCA order dated February 4 requires Enstar and Chugach to disclose all information they possess about LNG import facilities through which they intend to purchase LNG, including the estimated costs that would be recovered from customers through rates. Utilities are required to file their documentation by March 6.
The RCA emphasizes that while it does not supervise decisions to develop duplicative LNG imports, it does have authority to review any costs utilities seek to recover in customer rates for those facilities. In assessing any LNG-related agreements, the commission is likely to consider whether Enstar and Chugach should have explored or selected the alternative facility to meet their gas supply needs.
A key concern is whether ratepayers will bear the burden of paying for two projects when one could suffice to heat and power Southcentral Alaska. Analysts and officials worry about the potential for tens of millions of dollars in unnecessary costs, or more, if both facilities are built.
Both Enstar and Chugach have urged the RCA to collect and disclose the relevant information so the public and lawmakers can understand the cost-benefit dynamics of each option. They have also sought to keep some details confidential, citing competitive concerns.
In the legislative arena, Senate Majority Leader Cathy Giessel introduced a one-sentence bill to clarify that the state regulatory agency has authority over natural gas imports, aligning regulatory responsibilities with practical energy policy. The bill is framed to help ensure the lowest possible energy rates for Alaska as it considers LNG imports and related infrastructure. Giessel notes that a provision added to a carbon sequestration bill previously caused confusion by suggesting that the RCA lacked authority over LNG imports that fall under federal jurisdiction.
If the bill passes, it would remove ambiguity and reinforce the RCA’s power to regulate the price of gas sourced from LNG import facilities, rather than allowing authority to slip to federal regulators. Giessel argues that repealing the ambiguous language will make the RCA’s role in price regulation clearer and more predictable for consumers.
Harvest Midstream has filed import-project plans with federal regulators and hopes to begin bringing gas into Alaska next year. The company aims to repurpose the Kenai LNG export facility in Nikiski into a cost-efficient, ratepayer-friendly LNG import operation after acquiring the facility from Marathon last year. The plant previously exported LNG to Asia for more than four decades before it was mothballed in 2017. Officials say the facility has been well maintained through extensive due diligence.
Regulatory filings indicate the Nikiski site could deliver up to 20 billion cubic feet of gas annually, roughly 30% of the Railbelt’s consumption, extending from the Kenai Peninsula to Fairbanks. Harvest argues the project would provide a fast, certain, and flexible solution for near-term gas needs while preserving options for future exports if a North Slope gas line proceeds. They frame the project as a practical way to stabilize supply in the near term without precluding longer-term export opportunities.
Chugach Electric spokesperson Julie Hasquet welcomed the RCA’s information-gathering process, saying it will illuminate the costs and benefits of each project and help lawmakers and the public understand which option best serves Alaskans. She noted that Chugach’s gas-supply contracts with Hilcorp end in 2028 and Enstar’s contracts end in 2033, explaining why some flexibility is necessary given earlier project timelines.
Glenfarne, meanwhile, is targeting a 2029 start for the Cook Inlet Gateway LNG import terminal, which would be built at the same site planned for the Alaska LNG export project. Enstar president John Sims has suggested that the Glenfarne facility could eventually be repurposed to support Alaska LNG if that larger project progresses. Enstar argues that the Glenfarne plan offers rapid deployment and potential cost savings, while also reducing the likelihood that ratepayers fund infrastructure that may prove unnecessary if the Alaska LNG project moves forward.
Sims acknowledged that Harvest’s facility would not alone meet Enstar’s annual gas demand and indicated that Glenfarne’s project could potentially satisfy all Railbelt needs. He also highlighted the possibility of upsizing the Harvest facility, albeit at a significantly higher cost. The RCA has previously noted concerns about Enstar’s potential participation in a project controlled by Hilcorp, stressing the importance of spreading risk and ensuring long-term affordability for customers.
As the regulatory review continues, the RCA has signaled that it will scrutinize development costs and the overall reasonableness of the projects, including whether costs fall within its jurisdiction to consider for ratepayer recovery. If development costs exceed cap limits, the additional costs may be borne by the developers or shareholders rather than ratepayers. This evolving situation invites ongoing public discussion about how Alaska should balance energy reliability, project timelines, and consumer costs.
Would Alaska be better off with a single, strategically chosen LNG import project that can adapt to future energy needs and export opportunities, or do two parallel facilities offer a necessary hedge against supply disruptions? Share your thoughts in the comments about whether you think ratepayers should bear the cost of one or two LNG import facilities, and what safeguards could ensure the lowest possible energy costs for Alaskans.
