MLP-Chugach Electric Merger
On Nov. 6, 2007, the Phase I report regarding the reorganization or combination of the operations of Southcentral Alaska’s two largest electric utilities was released. The 127-page report by Navigant Consulting, says savings in electric rates could be achieved through some combination of the operations of Chugach Electric Association (Chugach) and Municipal Light and Power (ML&P).
The study is the result of an initiative by the Municipality of Anchorage and Chugach. Anchorage Mayor Mark Begich and Chugach Board Chair Elizabeth Vazquez on June 15 signed an agreement setting up a process for evaluating potential joint operations of the two utilities.
The Advisory Panel appointed by Mayor Begich and Board Chair Elizabeth Vazquez heard concluding testimony February 7 from Ron Nichols of Navigant Consulting, Inc.
Following the testimony, the Panel adopted a motion recommending that the management of Chugach Electric Association and Anchorage Municipal Light and Power seek ways to implement the savings identified by the Navigant study and report back to the panel within 60 days on their progress.
Navigant delivered its Draft Phase I report to the Panel in November 2007. Since that time the public provided the Panel a wide range of comments at a public hearing in late November. Navigant’s report identified potential savings of almost $200 million as possible through either a merger of the utilities or by jointly working together in areas such as construction of future generating capacity and consolidation of utility functions that are presently duplicated at each utility.
The motion and the amendment to the motion:
Original motion:
That the management of CEA and ML&P immediately enter into discussions to merge, or otherwise combine, the generation and operations of the two companies in an enterprise or enterprises that would create substantial savings over operating the companies separately an in such fashion that both managements support as practical and beneficial to their customers and owners and report their findings back this panel within 60 days.
Amendment/addition:
That this panel further ask the management of CEA and ML&P to plan to capture the savings contemplated in the Navigant study from cooperation on generation and that they do this in such a fashion that solicits participation and cooperation from other Railbelt utilities. This request is not meant to be used to delay a generation cooperation plan by requiring broader participation but, to ensure that the plan will provide for such action when and if it can happen.
All the documents developed on this issue are posted on this page.
You can sign up to be alerted by email about upcoming meetings by sending Leslie Ridle an email at RidleLD@muni.org or by calling her at 343-7115.
http://www.muni.org/mayor/mlpcea.cfm.
Comments?
If you’d like to submit public comment you can either email mlpcea@muni.org or send written comments to:
Mayor’s Office
PO Box 196650
Anchorage, AK 99519
Please include your name, address and a contact number on all correspondence.