Over the last two years, rural Alaska communities have received unprecedented support for the development of renewable energy. After decades of doggedly advancing projects to create affordable, reliable, locally controlled energy, rural communities suddenly had access to new federal clean energy funding and programs. These incentives are transformative, providing the option to finally move away from expensive diesel-generated electricity, and creating new economic opportunity in communities long held back by crippling energy costs.

Here are just a few examples: since 2024, Northwest Arctic Borough has been awarded $55 million of funding from the Office of Clean Energy Demonstrations to build out solar and battery units in 10 villages across the region. Tanana Chiefs Conference has received a $26 million award for a similar project. Spruce Root in Southeast Alaska was awarded $10 million in seed funding to launch a regional green bank and $4.9 million to help rural communities transition from diesel to heat pumps for home heating. Many communities, like Chefornak, Kongiganak, Atmautluak, Kipnuk and others, have been working on shoestring budgets to develop community-scale wind systems. When paired with batteries and distributed heating loads, these systems are reducing the need to purchase and import diesel fuel, while eliminating the need to expand fuel storage. Renewables are increasingly practical solutions for rural communities, rapidly closing the gap in both cost and performance.

For Alaska’s rural and remote communities, which bear the highest costs for energy in the nation, funding for renewable energy is not just “nice to have” — it is an existential imperative with no good alternatives. Alaskans already know renewable, locally controlled energy is game-changing. Kodiak, for example, now generates close to 100% of its electricity from hydro and wind, delivering cost stability and reliable power to the community. Similarly, Cordova now generates about three-quarters of its power through renewables. All of Alaska’s communities deserve such an opportunity.

Until recently, securing financing for these projects has been incredibly difficult. The state of Alaska has been a reliable investor in rural renewables, but state dollars are limited. Projects have been further hampered because private energy project finance doesn’t work well for the relatively small-sized projects in rural Alaska. At the recent energy conference in Anchorage, renewable energy finance panelists shared that projects need to be in the tens or hundreds of millions of dollars to pencil out as investments for private capital. In other words, Alaska’s solutions are too small for bankers.

But recent federal clean energy incentives opened up new pathways for these projects through direct investment and critical new provisions. Importantly, Alaska’s 200 microgrids (as well as the Railbelt utilities) are almost all owned by not-for-profit cooperative utilities, Tribes, or municipalities. These entities had been excluded from previous incentives that helped private energy developers elsewhere in the U.S. build out energy infrastructure for decades. Direct pay provisions in the Inflation Reduction Act changed that and gave Alaska, with its unique energy landscape, a chance to catch up, using the type of energy investments — diverse renewables and energy efficiency upgrades — that make the most sense for our rural communities.

Unfortunately for Alaskans, these hard-won incentives — as well as hundreds of millions in direct investments in Alaska projects — are under threat. The House of Representatives’ efforts to roll back clean energy investments, paired with the Trump administration’s cancellation of funding awards across the state, mean Alaska risks losing the financing pipeline just as rural communities were getting started. New proposals in the Senate released earlier this month do little to remedy the House changes for rural Alaska where a lack of capacity, longstanding bureaucratic obstacles, short construction seasons and long lead times for building projects make it virtually impossible for our communities to begin to build many renewable projects on the very shortened timelines demanded for projects to qualify for incentives. Once again, rural Alaska’s needs — flexible, reliable, stable incentives for renewables — are on the chopping block while wealthy private interests in the Lower 48 who can move fast will reap the only remaining incentives. Once again, the federal government is blocking our rural communities from coming up to par with the rest of the country.

Rural Alaska needs support now from our congressional delegation, which has the power to safeguard meaningful incentives for rural Alaska in the current budget reconciliation process — if they work together. As the Alaska Federation of Natives affirmed in its 2024 resolution on energy, “Energy security is fundamental to preserving cultural practices, maintaining local economies, and ensuring the well-being of residents in rural Alaska communities.” We are asking Sens. Sullivan, Senator Murkowski and Rep. Begich to join together to defend these critical investments in rural Alaska’s energy future.

Alana Peterson, Executive Director, Spruce Root, Inc.

Kerry Ivory, tribal administrator, Native Village of Ouzinkie.

President Kimberley Strong, Tribal Council of Chilkat Indian Village.

President John Christensen, Native Village of Port Heiden.

Deilah Johnson, tribal resources director, Village of Solomon.

Jonella Larson, partner, Alaska Venture Fund.

​Dave Messier, owner, Daylight Energy Services.

Robbie Townsend-Vennel, executive director, Kodiak Archipelago Leadership.

​Raina Thiele, senior executive advisor to the Alliance for Tribal Clean Energy.

President Kirsten Timbers, Native Village of Solomon.

​President Joel Jackson, Organized Village of Kake.

Penny Gage, chief policy and partnerships officer, Launch Alaska.

President Angutekaraq Estelle Thomson, Native Village of Paimiut Traditional Council.

President AlexAnna Salmon, Igiugig Village Council.

Dorinda Kewan, mayor, Port Lions.

Crystal Eggemeyer, tribal Administrator, Native Village of Port Lions.

Tashina Duttle, Deerstone Consulting.

Brian Hirsch, Deerstone Consulting.

Devany Plentovich, Deerstone Consulting.

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