How Mining Builds Critical Infrastructure in Alaska
Beyond its direct economic contributions through taxes, jobs, and business opportunities, the mining industry in Alaska plays a significant role in developing essential infrastructure that benefits communities and the state as a whole. Due to the remote locations and specific needs of mining operations, companies often invest in projects that have long-term positive impacts beyond the lifespan of the mine itself, like the following:
Juneau's Hydroelectric System
The history of Juneau's hydroelectric power system is deeply intertwined with the mining industry. Over a century ago, mining operations were the first developers of this crucial energy infrastructure. These early investments made laid the groundwork for the reliable and sustainable hydroelectric power that continues to serve the city of Juneau. Today, Greens Creek is a large Juneau power customer. By purchasing surplus hydropower, the mine has provided Juneau residents with over $80 million in reduced electricity rates since 2009.
The Pogo Mine's Infrastructure Investment
To access and operate the remote Pogo Mine, significant infrastructure development was necessary. The mine funded the construction of a 50-mile road, providing a transportation link to the area. Additionally, a power transmission line was built to supply the mine's energy needs. This infrastructure not only supports the ongoing operations of the Pogo Mine but also enhances accessibility and opens up possibilities for future development in the surrounding region.
Benefits for Fairbanks Electric Utility and Its Residential Customers
Industrial customers like the Fort Knox and Pogo mines are long-term steady purchasers of electricity for their operations. This allowed the Golden Valley Electric Association to make large scale investments to increase efficiencies and the savings were passed onto residential customers.
Ports and Roads for Kensington and Greens Creek Mines
The geography of Southeast Alaska often requires specialized transportation solutions. In response to the needs of their operations, both the Kensington and Greens Creek Mines undertook the development of their own port facilities. These ports provide essential access for shipping and receiving goods. Furthermore, these mines also constructed and maintain their roads.
The Delong Mountain Transportation System and Red Dog Mine
A prime example of large-scale infrastructure development facilitated by mining is the Delong Mountain Transportation System. This significant project, undertaken by the Alaska Industrial Development and Export Authority (AIDEA), was specifically designed to provide road and port access for the Red Dog Mine.
The financial model for this infrastructure is noteworthy: Red Dog Mine pays tolls to AIDEA for its use. These toll payments have proven to be sustainable, generating a 6.5% return on investment for AIDEA and successfully repaying the initial construction costs, allowing AIDEA to provide dividends to the state budget. This demonstrates a model where mining directly contributes to and sustains major infrastructure benefiting the state.
Long-Term Benefits of Mining Infrastructure
The infrastructure investments spurred by Alaska's mining industry create an enduring legacy that extends well beyond the lifespan of any single mining operation. The roads, power grids, and port facilities developed to support resource extraction become vital assets for other sectors, enhance accessibility for residents, and fundamentally contribute to the long-term economic development and interconnectedness of Alaska. Mining, therefore, acts as a significant catalyst in building and sustaining the essential infrastructure that underpins the state's future.
