Business meeting to consider the nomination of William Kirkland, of Georgia, to be an Assistant Secretary of the Interior; to be immediately followed by hearings to examine Federal programs at the Department of Energy.

2025-09-10

Summary

This meeting discussed the challenges and opportunities in energy development for tribal communities, particularly focusing on the effectiveness of the Tribal Energy Financing Program and the unique needs of remote Alaskan villages [ 00:06:28 ]

. Participants highlighted the necessity of revisiting current program structures and improving financial tools to better serve these communities [ 00:06:28 ] .

Themes

Challenges with Current Funding and Program Implementation

Grant funding for bulk fuel needs is insufficient to cover capital, operation, and maintenance costs . The Tribal Energy Financing Program (TEFP) is underutilized, especially in Alaska, due to various systemic issues . Lack of staff training and high turnover within loan offices lead to confusion, increased administrative burdens for tribes, and significant delays in application processing . Applicants have reported being strung along for months, facing questions about project eligibility or being asked to expand project scopes without appreciation for the massive burden . Tribes also bear the cost of external consultants when agencies lack in-house legal expertise . Systemic barriers include a lack of administrative capacity within tribes and a general agency misunderstanding of tribal government structures and revenue models, further extending project timelines .

Proposed Solutions and Program Improvements

One significant recommendation is to bundle and aggregate projects to achieve efficiencies, such as financing multiple tank farms or combining various energy infrastructure components like powerhouses, renewables, and battery systems . This approach is particularly beneficial for geographically proximate locations, optimizing logistics and field visits . Mitigating risk through technical oversight, de-risking projects with grant funding, and understanding the capital stack can lower risk for lenders, facilitating project advancement . It was also suggested that current tribal loan programs might need restructuring, potentially separating them based on the size, capacity, or capability of the tribal entity, rather than treating all tribal entities identically . Braiding funding streams and leveraging resources across different programs were also identified as ways to improve access to support .

Importance of Integrated Energy Systems

Diesel and other bulk fuels are recognized as the unavoidable backbone of microgrids in rural Alaska . While integrating renewables helps with fuel cost fluctuations and reduces long-term costs, they are considered intermittent sources that require coupling with reliable backups like diesel . The addition of battery storage to existing wind and diesel systems has demonstrated significant savings, with one village saving over 60,000 gallons of diesel annually, equating to more than $250,000 [ 00:07:37 ]

. The Tribal Energy Finance Program's flexibility to support any energy technology, including a mix of sources, is seen as a key benefit [ 00:09:44 ] .

Staffing and Expertise Issues in the Loan Program Office

A critical concern is the limited staffing and lack of specific expertise regarding tribal needs within the Loan Program Office (LPO) [ 00:11:50 ]

. The LPO operates with fewer than half its regular staff due to vacancies and administrative leaves [ 00:19:42-00:20:01 ] . Although there were attempts to dedicate staff to tribal projects, the office struggled to fill and retain these positions, leading to staff rotation and inconsistencies in information provided to tribes [ 00:20:39-00:20:52 ] . This disparity between a strong tribal outreach team and the loan origination staff creates further problems as projects progress [ 00:20:58-00:21:21 ] .

Inequities in Energy Access and Basic Needs

The discussion underscored the vast inequities in Indian country, particularly in Alaskan communities where many lack basic services like running water and electricity . Communities with the least capacity are often in the most challenging situations, struggling to meet fundamental needs, and find existing federal programs inaccessible or out of reach . This highlights a need for greater technical assistance and removal of financial barriers that disproportionately affect those with fewer resources .

Tone of the Meeting

The tone of the meeting was largely concerned and critical of the current state of tribal energy financing programs, but also constructive and solution-oriented [ 00:06:28 ]

. Speakers expressed frustration with administrative inefficiencies, lack of specific expertise, and the vast inequities in energy access for tribal communities . There was a clear emphasis on the need for significant reforms and a commitment to exploring new approaches to better serve these communities .

Participants

Transcript

Lisa A. Murkowski

And so I really appreciate that you have ventured out and gone beyond just saying this is what you might want to recommend for existing program, but maybe we need to revisit, to re-look at this. In my head, I'm thinking about what... what the Nuclear Regulatory Commission is dealing with on the nuclear side. And there's a big difference between permitting and siting a three-mile island versus what we're talking about with small modular reactors. And yet, it's kind of the same thing. We're going to put you in the same bucket and it's going to be just awful. We're doing that with hydro relicensing, where it doesn't make any difference if you're the Hoover Dam or if you're a small dam in southeast Alaska. So I think you're challenging us to look perhaps a little bit differently at how we might structure this so that we really do get that value. Let me ask you, Jocelyn, You mentioned a couple times in your testimony that the funding that is available, the grant funding that we're providing, particularly when it comes to the bulk fuel needs, isn't enough to address the capital needs, much less the operation and the maintenance. So you've cited the need for improved public financing tools, greater flexibility. What opportunities do you see within DOE's tribal energy financing program? What do you think it's going to take to make it work better in Alaska and how we can kind of address the underutilization that we see of the tribal energy financing program?

Lisa A. Murkowski

Right. To start with, we see that bundled projects and aggregating projects to get some of those efficiencies is key. So bundling a bulk fuel project, for example, instead of financing one $8 million tank farm in a single village, we could have a- Remind me, how many bulk fuel projects, how many communities are being looped into this one proposal that you're working right now? What we call phase one. The $100 million is going into 10 communities. And each community doesn't break down to $10 million each community. It depends. It's very site specific and we have to get out and make sure that we have our our designs and whatnot. So aggregating, having more funding at one time, there are efficiencies to be gained, having projects that have proximal geographic locations, for field visits and logistics for the equipment and supplies to do the projects, having mixed energy infrastructure packets together or packaged together like a tank farm, a powerhouse upgrade, and renewables and a battery system package all at one time. We recognize that diesel and other bulk fuels are unavoidable in rural Alaska. They serve as the backbone to these series of microgrids. While integrating renewables, we need to upgrade those systems so often. So having a technology neutral or energy agnostic project in a community to really push forward into... I'm going to interrupt you there because that's something that needs to be underscored.

Lisa A. Murkowski

I think sometimes the thought is, well, if we put in that wind turbine or if we put in a few solar panels over here, then we don't need the bulk fuel storage. We don't need that. But you've got to have the backup and you have intermittent sources that are not there in Solar is not good 365 days a year anywhere, much less in Alaska. So I think that's important that we underscore that these do – you've got a coupling that goes on. Absolutely. The wind doesn't always blow and the sun doesn't always shine, but the diesel-generated power plant is – is that energy and power backbone of those communities. And while integrating renewables helps with fuel shortages or price of fuel fluctuations and rural and remote communities really find renewables to be a very beneficial aspect of the power supply. Every gallon of diesel offset is helpful lowering long-term costs and whatnot. So that's definitely part of a piece of the puzzle. So let's see. Expanding your projects, aggregating projects, having mixed energy infrastructure projects, and then mitigating risk by either having technical oversight or de-risking projects with grant funding, understanding the capital stack, lowering the risk to lenders and whatnot that can really help these projects moving forward and understanding, again, understanding that deferred energy and bulk fuel needs, grants are not, they're just not gonna cut it moving forward.

Lisa A. Murkowski

And we are doing a bulk fuel aggregation study that we're very excited about hearing the recommendations, but they're not ready yet for this hearing, unfortunately, but stay tuned. Okay, yeah, we will stay tuned on that. Chair Murkowski? Yeah, go ahead, Dr. Ortiz.

Anna Maria Ortiz

If I might jump in just on integrating different energy sources.

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