In December, as our state legislators looked ahead to 2026, many expected Alaska LNG’s private developer, Glenfarne, to ask them for tax cuts. Glenfarne and its state-owned minority partner, the Alaska Gasline Development Corporation (AGDC), had been negotiating with boroughs and cities for cuts to property taxes that help pay for local road maintenance, schools, emergency services, and other public services. Though a tax-cut bill wouldn’t be introduced until March, many of our legislators were thinking about the proposal last winter. And many were skeptical.
One of these was Senator Jesse Bjorkman, who represents the northern Kenai Peninsula. On December 10, he said in an interview with KDLL public radio that Glenfarne and AGDC were “developing a credibility gap with the legislature.” You can hear him speak on AK LNG around 32.00 in this recording.
Senator Bjorkman in December 2025, on giving AK LNG a tax break:
“I think absolutely we should — if the gas project functions as a public utility that’s regulated by the RCA (Regulatory Commission of Alaska), they’re developing utility gas for electric utilities and ENSTAR to pay our heat and light bills — then yeah, they should probably have a property tax holiday, they should not pay property tax. We should not be increasing costs on ourselves to deliver those things. However, Glenfarne’s a for-profit company. And they’re going to make money on this deal. A deal which by any design is not going to net the state a ton of revenue. Its design is to provide for low-cost energy. If it doesn’t deliver on that, we need to ask ourselves other questions. If the project is going to result in higher-cost energy than we would even pay by importing gas, then we need to ask ourselves why we want to do this project.”
AK LNG is not a regulated public utility, and there seem to be no plans to make it one. Yes, the Regulatory Commission of Alaska (RCA) must approve AK LNG’s contracts with regulated utilities like ENSTAR, but this is very different from being under the RCA’s authority to ensure rates are “just, fair, and reasonable” — which includes regulating profits.
As for delivering lower-cost energy, it’s become very clear since December that AK LNG has a poor chance. Its Phase 1, designed to deliver gas only for the Alaskan market, does not beat the cost of imported LNG. The state’s price modeling shows that even with tax breaks and an inflated forecast of gas demand, AK LNG Phase 1 breakeven prices wouldn’t be less than about $20 per thousand cubic feet. High-end estimates for imported LNG are around $17. Current versions of the tax break bill cap Phase 1 gas at about $16.59 per thousand cubic feet, though with inflation adjustment, the actual price would be higher. This cap only beats the high end of potential LNG import prices. Alaskan economist Bradford Keithley has written and spoken extensively about the likelihood of better deals being on the table.
Lower gas prices are a promise of AK LNG Phase 2, which would build out export infrastructure, allowing most of the project’s enormous capital cost to be shifted to larger overseas buyers. But these promised gas prices, in the range of $4-$6, are a mirage until those overseas buyers sign firm gas contracts. There’s no reason to think they’ll be very eager. Analysts forecast an LNG glut extending into the 2030s. Alaska’s cost modeling shows a slim chance of AK LNG beating the past ten-year average LNG cost in Asia. But not even Glenfarne knows how realistic that chance is, since they haven’t done detailed cost studies of Phase 2 and don’t plan to until the end of the year. Regarding Phase 2 economics, they’ve given only what Bjorkman dismissed in December as “cloudy, rosy, canned presentations.”
The bill Governor Dunleavy eventually introduced excused AK LNG from roughly 90% of the property taxes shared with local governments to help fund education, road maintenance, fire departments, and other services. Now, after many twists, turns, and amendments, it’s in front of legislators in the form of House Bill 381.
The AK LNG “credibility gap” that Bjorkman was concerned about has only grown. Unfortunately, it appears Bjorkman’s credulity gap has, too. He is now advocating a tax break for AK LNG with few strings attached.
On June 18, the day before the Senate voted on HB 381, he posted to Facebook: “I will continue fighting to keep this bill clean and oppose changes that could jeopardize the AK LNG project, increase costs, impose additional taxes, or divert Kenai Peninsula Borough revenues away from our communities. If you support Alaska LNG, it is time again to make your voice heard. Please continue contacting Senate members and urge them to pass a clean HB 381 without new taxes, unnecessary burdens, or revenue diversions.”
Bjorkman ultimately voted for the Senate’s heavily amended version of the bill, though he wrote on Facebook the next day that some amendments “make the project more difficult to finance and reduce revenue intended for communities hosting project infrastructure.” Bjorkman nonetheless voted yes because “passing the bill keeps negotiations moving forward and preserves the opportunity to improve it in conference committee,” he wrote.
Regardless of any amendments that may be struck or added, HB 381 is fundamentally a bill that shouldn’t pass. It is not a fruitful tax holiday for a credible energy project, the thing that Bjorkman conditioned his support on in December. Whatever compromise version of the bill emerges in July, I hope Senator Bjorkman brings to the floor the wisely skeptical attitude he had eight months ago.
I happened to hear Senator Bjorkman talking on the radio this winter. But he is probably far from the only legislator who’s walking back from a sensible position on AK LNG in the face of the PR barrage from gasline interests. As legislators prepare to consider a compromise version of HB 381, with a vote likely in early July, the coming weeks are a critical time for those who want reasoned, well-supported energy decisions from Juneau to be sure their legislators hear them.
You can find phone numbers and email addresses for Legislators at akleg.gov (see the Senate here and the House here). Not sure who represents you? Enter your address into the “Who Represents Me?” field at the bottom of any akleg.gov webpage to find out.
The perception in Juneau persists that voters want a gasline at any cost. In fact, this is far from the truth. Call or email your legislators to set their impressions straight.