MEA: Rates to go up, but not bills

PALMER — Matanuska Electric Association rates are set to go up slightly more than 6 percent this year but, the utility says, a lot of its customers might not even notice.

“While MEA may be increasing the base rate, the energy charge, the fuel charge, has gone down,” said MEA spokeswoman Lorali Carter.

To unpack that a bit — there are separate lines on each customer’s MEA bill. One is just a pass-through from the Chugach Electric Association. MEA doesn’t really have any say over that one. Chugach sells MEA the bulk of its power and its rates are going down. But the other charge represents the cost for MEA’s services getting that power to customers.

“With the decrease in (Chugach’s) rates and the slight increase in the base rates it really does kind of even out,” Carter said.

In hard numbers, MEA’s rates are projected to go up 1.55 percent in the second quarter of 2010, 3.18 percent in the third quarter and 1.35 percent in the fourth quarter.

MEA’s interim general manager Joe Griffith — who is poised to become the co-op’s permanent boss — said the raise in the rates is necessary. The co-op, he said, has a number of places it needs to improve and those improvements cost money.

First off there’s the issue of what he has described as 15 years of deferred maintenance, most notably on MEA’s trucks and other vehicles.

“Our rolling stock average mileage is 100,000 miles per vehicle,” he said.

To put that in context, a lot of organizations with quite a bit of rolling stock see 100,000 miles as something of a cutoff point. The Palmer Police Department, for instance, replaces its police cruisers at 100,000 miles, as long as there is enough money to do it, said Palmer’s director of public safety Jon Owen. He said that at 100,000 miles maintenance costs tend to outstrip the benefits of keeping the vehicle.

Of course some people tend to differ on the topic. Ron Causa, owner of C & C Auto Care in Wasilla, said 100,000 isn’t necessarily a cutoff point.

“In this day and age, if people have maintained them correctly, for example a fleet vehicle which is on a maintenance schedule, at 100,000 it’s really not uncommon to see 100,000 without major problems,” Causa said. A more accurate gauge of a vehicle’s usefulness, he said, might be to calculate a car’s “cost per mile” to see if it’s worth keeping.

Other costs MEA is facing, Griffith said, include clearing vegetation from under and around power lines. The company needs to beef up their program to do that, along with employee training.

“People, you’ve got to have people to do the work. And you’ve got to have trained people and we haven’t trained them hard enough,” Griffith said.

And, he said, there aren’t enough people.

Carter described that a bit: In 1999, MEA had 20 more employees than it has today. Currently, she said, staffing hovers at about 118 employees. Given that the Valley’s population — and, by extension, MEA’s customer base — has grown substantially since 1999, Carter said, the co-op could use some more hands.

“Our 2010 staffing plan at peak levels provides for 18 more positions,” she said.

Griffith added that MEA is, geographically, the largest electrical cooperative in the United States, and those 118 or so employees have to cover an enormous area. The Mat-Su Borough, on official documents, often points out that the borough is the size of West Virginia. Some areas of the borough don’t use MEA power, but MEA also services Eagle River.

“This first bite I took at the apple is going to raise the rates a little bit,” Griffith said, but, “if we … make the right moves in the next year or two we can ensure the long-term reliable and affordable electricity that we need to have.”

Contact Andrew Wellner at andrew.wellner@frontiersman.com or 352-2270.