Studies have resumed for the $5.6-billion Susitna-Watana Hydroelectric Project in Alaska, following clarification in July of an executive order by Gov. Bill Walker (D) limiting government spending. Plummeting oil prices prompted the order last December “to stop non-obligated spending” on six megaprojects, which have a total estimated cost close to $7 billion. The hydro project is the largest of that group.
Since the completion of the Trans-Alaska Oil Pipeline, petroleum revenues to the state have averaged over 85%, according to the Alaska Oil and Gas Association. No other state is so dependent on one industry to fund government services. The oil-price collapse thus dealt a substantial blow to the state’s ability to fund infrastructure megaprojects, necessitating a reassessment (ENR 3/30-4/6/15 p. 6).