AEA says Power Project Loan Fund has recovered and will again offer loans; thresholds determine approval path

The Alaska Energy Authority told the House Energy Committee that the agency's Power Project Loan Fund is available again for lending after a period of low balance and that demand is increasing for larger loans.

Connor Erickson, AEA—s director of planning, said the fund had a current loan balance of about $31 million across 15 loans but the available fund balance had been low in recent years. He said after a larger project withdrew, that action recapitalized the fund and "now we're sitting on a pretty healthy balance of around $9,600,000 as of December." Erickson said recent loan requests are larger than historically typical; the last two loans were approaching $5 million each.

On approval thresholds, committee testimony identified internal governance: requests between $0 and $2 million are approved by the loan committee; requests from $2 million to $5 million require loan-committee review and board approval; and any loan over $5 million requires legislative approval. As AEA staff explained, the fund can provide working capital, construction funding and preliminary design or reconnaissance for a range of energy projects and can be used to leverage federal grants when applicants opt for that financing approach.

AEA said it plans to advertise the program again now that funds are available and that it will provide updated loan materials to the committee. Erickson emphasized the loan program is not a grants program and applicants often prefer federal grant opportunities that do not require repayment.

Ending: Committee members welcomed renewed availability and requested ongoing updates on loan demand and any requests that would require board or legislative action.