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An Alaska state flag blows in the wind at the Robert B. Atwood Building in Anchorage, Alaska.
David Ryder | Bloomberg | Getty Images

These are tough times in Skagway, Alaska, population 1,183.

“We’re in hard core survival mode,” Mayor Andrew Cremata told CNBC.

In a normal summer, the Southeast Alaska town would be teeming with tourists from the cruise ships sailing the Inside Passage. Residents could drive 15 miles up the Yukon Highway into Canada to run their basic errands, or they could hop on a state-run ferry to the next town over, Haines.

But this year, the cruise ships have just started running again. Cremata is hoping Skagway will see 100,000 passengers this year; in 2019 they had 1.1 million. The border to Canada remains closed to non-essential traffic, and the ferries, part of the Alaska Marine Highway System, are plagued by budget cuts.

“Just getting your family down to go see a dentist or doctor, when that becomes burdensome or overly expensive, there’s a point where people have just had it and move away,” Cremata said.

Multiply Skagway’s situation by thousands of communities and more than 700,000 Alaskans, and you can begin to understand why The Last Frontier finds itself in last place in CNBC’s 2021 America’s Top States for Business rankings.

It is the sixth bottom-state finish for Alaska in 14 years. The state previously achieved the dubious distinction in the first four years of the study between 2007 and 2010, hitting bottom again in 2018.

As difficult as the past year has been in this state and across the country, it presented opportunities that Alaska failed to capitalize on.

Alaska met the pandemic with the best-funded public health system in the nation, according to the United Health Foundation, spending $289 per person per year. That is more than three times the national average. Earlier this year, the state was setting the pace for Covid-19 vaccinations, even in its most remote regions.

As the national economy struggled to regain its footing, Alaska offered a generally business-friendly regulatory climate — its legal system tilts toward business, and the number of state laws and regulations is manageable. The conservative-leaning Tax Foundation ranks Alaska’s tax climate the third-best in the country.

In Skagway, Mayor Cremata said state and federal officials have been extremely helpful through the crisis.

“They are always ready and willing not only to engage us as a community, but individual people and business owners in the community. People that were struggling with problems with unemployment and all these kinds of things,” he said.

And at a time of social upheaval, Alaska offered its relatively diverse population some strong protections against discrimination.

High costs hurt Alaska

So how did Alaska manage to finish No. 50 again in 2021 despite so many advantages going in? In a word: cost.

Cost of Doing Business carries the most weight in this year’s study. As the recovery builds, states are touting low business costs more than any other factor, according to CNBC’s analysis. Alaska is an extremely expensive place to do business.

Even Alaska’s competitive tax climate, which earns points for relatively low property taxes and no personal income tax, includes a top corporate tax rate of 9.4%, among the highest in the country.

A snow covered road with power lines in Kaktovic, Alaska.
David Howells | Corbis Historical | Getty Images

Utility costs are oppressive. Alaskans paid an average of $20.20 per kilowatt hour for electricity last year, according to U.S. Department of Energy data, with even higher rates in remote areas. That was second only to Hawaii, and nearly double the national average. Wages are high thanks to the high cost of living, and office and industrial space — which are in short supply — is pricey.

Cremata said he is worried about how the price of everything seems to be creeping higher.

“Everything’s barged in,” he said. “And so, if the cost of fuel goes up, it affects the rates on the barge and that affects the price of your milk and eggs.”

Indeed, even that high rate of public health funding may be deceiving, because health care in Alaska is so expensive. An office visit to a doctor in Anchorage averaged more than $206 last year, according to the Council for Community and Economic Research, C2ER. That is more than twice the cost in Phoenix, Arizona.

Meanwhile, Alaska’s Covid-19 vaccination rate, once the envy of the nation, has fallen below the national average, according to data from the U.S. Centers for Disease Control and Prevention.

Medical Assistant Julia Naea administers the Pfizer Covid-19 vaccine at the Blood Bank of Alaska in Anchorage on March 19, 2021.
Frederic J. Brown | AFP | Getty Images

In March, Alaska became the first state in the nation to make vaccines available to everyone aged 16 and older. Officials theorize that meant those who wanted to be vaccinated were quick to get their shots, leaving vaccine-hesitant residents — many in rural or remote areas — who have proven difficult to convince.

Vaccination rates are a metric in the Top States’ Life, Health and Inclusion category, where Alaska finishes No. 19 this year.

Internet access remains a challenge

In addition to its cost issues, Alaska ranks No. 49 in the Top States’ Infrastructure category, above only Maine. It is yet another lost opportunity. Alaska might have been able to use the nation’s move toward remote work to partly offset its inherent infrastructure disadvantages, which include its distance from the rest of the country and its vast size.

This year’s Top States study introduced broadband connectivity as an infrastructure metric. But broadband in Alaska is the worst in the nation, according to BroadbandNow Research.

In Skagway, Cremata said internet service is cumbersome and expensive.

“You have to actually have a landline in your house for it to work,” he said. “So, the internet has a pretty substantial price to it, but then you also have a $30 charge because you need a landline for the broadband to work.”

According to BroadbandNow, fewer than 61% of Alaskans have access to broadband at all, and none have access to a low-priced plan, which the organization defines as costing less than $60 per month. The average speed is a paltry 58.6 Mbps, or one-third the speed in the top-ranked state, New Jersey.

Cremata said that early in the pandemic, when he and other local leaders worried the cruise ships could disappear for five years, they convened a task force to consider ways to reinvent the economy. One of the ideas was to make Skagway an internet hub, but it went nowhere.

“You’d have to have really fast internet, obviously, because you probably want to have all of your communications done in the cloud, which is pretty much impossible right now in Skagway,” he said.

Alaska Gov. Mike Dunleavy, while speaking at a dedication ceremony for a hydroelectric turbine generator in Igiugig, Alaska, on Tuesday, July 16, 2019.
Luis Sinco | Los Angeles Times | Getty Images

In May, Gov. Mike Dunleavy created a task force to recommend ways to improve connectivity in the state.

“On the heels of a global pandemic, now more than ever do we see the critical role that the internet plays in nearly every part of life and the importance of good connectivity for every Alaskan,” Dunleavy said in a statement.

But it is Alaska’s third broadband task force in the last decade, with little to show for the efforts. It is also unclear whether the state can muster the funding needed to bring its service up to date.

In his statement announcing the task force, Dunleavy, a Republican, emphasized the use of federal pandemic relief money to pay for the expansion. And while his administrative order creating the task force also contemplates using state funds, Dunleavy and the state legislature are already locked in a titanic struggle over the budget.

This month, Dunleavy vetoed more than $200 million in state spending approved by the legislature, with cuts aimed at everything from tourism marketing to mental health services.

Dunleavy also vetoed $8.5 million in funding for Alaska’s ferry system known as the Alaska Marine Highway System, a link to the outside world for communities like Skagway. 

And he relentlessly slashed the University of Alaska’s budget, with cuts totaling $70 million over three years. That hurts the state’s ranking in Education, where it finishes No. 47.

Crude oil rebound hasn’t helped Alaska

Hanging over all of Alaska’s business and financial woes is the price of oil, the state’s economic lifeblood. Oil revenues typically account for more than one-third of the state’s budget.

A part of the Trans Alaska Pipeline System is seen on September 17, 2019 in Fairbanks, Alaska.
Joe Raedle | Getty Images

Last year, as weak demand during the pandemic pushed oil prices to historic lows, oil production in Alaska fell to its lowest level in more than 40 years, according to the Energy Department.

This year, prices have rebounded, but production in Alaska has not. Alaska oil producers face much lower cost competition in the lower 48, as well as an intensifying tug-of-war over federal oil leases. Production through April was down nearly 5% from a year ago.

State budget forecasters expect oil production tax revenue will be around $311 million in the 2021 fiscal year that ended on July 1. That would be a 9% increase from 2020, but a 36% decline from the year before.

Those kinds of numbers could make it even harder for Alaska to climb out of the cellar next year.

Cremata said he hopes the crisis will convince Alaska to think beyond its traditional economic drivers including tourism, fishing and oil.

“You can’t think backwards. You have to think forwards,” he said. “Perhaps, this is like a chaos-opportunity moment — where there’s chaos, there’s opportunity, so that people in Alaska, who maybe have been relying on things that aren’t as reliable anymore, maybe try to expand towards some different ideas.”

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Dealers are slashing prices on 2025 Kia Niro EV, nearly 25% off!

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Dealers are slashing prices on 2025 Kia Niro EV, nearly 25% off!

Just like it says on the tin – retailers are advertising killer deals on the fun-to-drive Kia Niro EV, with one midwest auto dealer reporting more than $10,000 off the sticker price of the Niro EV Wind. That’s nearly 25% off the top line price!

SKIP THE STORYget straight to the deals.

The Kia Niro EV gets overshadowed by its objectively excellent EV6 and EV9 stablemates – both of which are currently available with substantial lease cash and 0% APR financing, in fact – but that doesn’t mean it’s not an excellent little electric runabout in its own right.

The last time I had a Niro EV tester, my kids loved it, I liked that it was quicker and more tossable than I expected it to be, and my wife liked the fact that “it doesn’t look electric. It looks normal.” And, with well over 200 miles of real world range (EPA-rated range is 253 miles), it was more than up to the task of commuting around Chicago and making the trip up to the Great Wolf Lodge in Gurnee and back without even needing to look for a charger.

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It’s not the primary family hauler I’d choose – but as a second car? As a primary car for a slightly smaller family (1-2 kids, instead of 3-4)? The Kia Niro EV Wind, with a $42,470 MSRP, seems like a solid, “can’t go wrong” sort of choice. You know?

You won’t even have to pay that much, though. Raymond Kia in Antioch, Illinois is advertising a $42,470 Niro EV for $32,431 (that’s $10,039, or about 24% off the MSRP), and several others are advertising prices in the $33,000 range.

And, while we’re at it:


SOURCE | IMAGES: CarsDirect, Edmunds, Raymond Kia.


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Lion Electric leaves US school districts stuck with unsafe, broken buses

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Lion Electric leaves US school districts stuck with unsafe, broken buses

Many school districts who used EPA funding to help purchase Lion Electric school buses are now stuck with broken down or unsafe vehicles – but Lion’s new Canadian investors seemingly have no plans to make things right.

“All four Lion buses that we own are currently parked and not being used,” Coleen Souza, interim transportation director of Winthrop Public Schools, told Jay Traugott over at Clean Trucking. “Two of them are in need of repairs which would cost us money which we are not willing to invest in because the buses do not run for more than a month before needing more repairs.”

The story is much the same at other US school districts who deployed Lion Electric buses over the last few years – and the trouble they describe isn’t isolated to a single component or system. One district we spoke to had onboard chargers that failed almost immediately after being plugged into a L2 AC charger. Another that spoke to Traugott reported emergency door gaps, power steering failure, loss of power, and braking issues.

As bad as the revelations of safety and drivability issues and $250 million in unresolved debt have been, it’s the objectively stupid design choices that have been the most shocking.

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“Lion built an auxiliary diesel heater to heat the bus, essentially writing the manual as they went,” explained a school superintendent in the midwest, who asked not to be named. “It was fascinating to watch but there were design flaws with the heater. For example, the intakes pointed downward and we’re driving across rural roads and the intake sucks in that dirt.”

“Using a diesel-powered heater to warm an electric bus also somewhat defeats the purpose of going 100% zero-emissions,” added Traugott.

Despite a new electric school bus rebate and a fresh cash injection from Vincent Chiara, president of Quebec real estate powerhouse Groupe MACH, and Lion director Pierre Wilkie, however, it seems like no help is coming.

It just gets worse and worse


Decommissioned Lion electric buses; via Winthrop Public Schools.

Despite early speculation – some of it my own, in fact – that the new investors would take the Canadian government up on its offer to help subsidize more electric school bus production and honor the company’s outstanding warranty claims, it appears the only vehicle line the new investors are interested in reviving are the the Class 8 electric semi manufacturing operations in Saint-Jérôme, Quebec.

The US school districts who spent tens of millions of taxpayer dollars in the hopes that Lion buses would help decarbonize their fleets and reduce students’ exposure to harmful diesel emissions? Many of them are back to using diesel, while others are trying to get their deposits back so they can buy something else.

Here’s hoping any school districts on the fence for electrification recognize that their are very real, very well-engineered, and very financially sound electric school bus manufacturers out there who can deliver on their promises.

SOURCES: Chicago Tribune, Clean Trucking, Electrical Business.


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Mitsubishi debuts EV battery swap network for cars AND trucks in Tokyo

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Mitsubishi debuts EV battery swap network for cars AND trucks in Tokyo

Mitsubishi is partnering with Ample and Yamoto Transports to deploy an innovative new battery swap network for electric cars in its Japanese home market — but it’s not just for electric cars. Mitsubishi Fuso commercial trucks are getting in on the action, too!

Despite a number of early EV adopters with an overdeveloped concept of ownership, battery swap technology has proven to be both extremely effective and extremely positive to the overall EV ownership experience. And when you see how simple it is to add hundreds of miles of driving in just 100 seconds — quicker, in many cases, than pumping a tank of liquid fuel into an ICE-powered car — you might come around, yourself.

That seems to be what Mitsubishi thinks, anyway, and they’re hoping they’ll be your go-to choice when it’s time to electrify your regional and last-mile commercial delivery fleet(s) by launching a multi-year pilot program to deploy more than 150 battery-swappable commercial electric vehicles and 14 modular battery swapping stations across Tokyo, where the company plans to showcase its “five minute charging” tech in full view of hundreds of commercial fleets and, crucially, the executives of the companies that own and manage them.

How battery swap works for electric trucks
How battery swap works for electric trucks; via Mitsubishi Fuso.

A truck like the Mitsubishi eCanter typically requires a full night of AC charging to top off its batteries, and at least an hour or two on DC charging in Japan, according to Fuso. This joint pilot by Mitsubishi, Mitsubishi Fuso Trucks, and Ample aims to circumvent this issue of forced downtime with its swappable batteries, supporting vehicle uptime by delivering a full charge within minutes. The move is meant to encourage the transport industry’s EV shift while creating a depository of stored energy that can be deployed to the grid in the event of a natural disaster — something Mitsubishi in Japan has been working on for years.

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Trucks like the eCanter already serve a number of roles throughout the global truck market, including municipal waste collection, regional delivery support, and more.

The pilot is backed by Tokyo Metropolitan Government’s “Technology Development Support Project for Promoting New Energy,” with local delivery operator Yamato Transport testing swappable EVs for delivery operations on both its eCanter light-duty trucks and Mitsubishi Minicab kei-class electric vans.

Electrek’s Take


Fuso eCanter battery swap; via Mitsubishi.

Electrifying the commercial truck fleet is a key part of decarbonizing city truck fleets – not just here in the US, but around the world. I called the eCanter, “a great product for moving stuff around densely packed city streets,” and eliminating the corporate fear of EV charging in the wild just makes it an even better product for that purpose.

Here’s hoping we see more “right size” electric solutions like this one (and more battery swapping tech) in small towns and tight urban environments stateside somewhat sooner than later.

SOURCES | IMAGES: Mitsubishi, Fuso.


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