MEA's solo course fuels contention

March 4, 2007

By Russell Stigall

Frontiersman

MAT-SU - Matanuska Electric Association's decision to &#8220go it alone” for power generation is not the preferred route, officials at other Alaska utility cooperatives say.

Tuckerman Babcock, MEA's director or human resources and corporate affairs, said after years of problems trying to work with Chugach Electric, the co-op needs to blaze its own trail.

&#8220MEA is going to ensure we have reliable power so we are not the first off and last on, which is how we've been treated by Chugach [Electric Association],” he said. &#8220We're a captive customer of someone who takes care of their customers first,” Babcock said.

Phil Steyer, director of government relations and corporate communications for Chugach Electric, sees it differently. Since the physics of every outage is different, he said, &#8220we would disagree with [MEA's] characterization.”

Not all Railbelt co-ops share MEA's

distaste for doing business with Chugach Electric.

Jim Posey, general manager of Anchorage's Municipal Light and Power, said his utility is working with Chugach to update its aging generation.

&#8220I know it is economical for them, and I know it is economical for us. It is a matter of where we do it,” he said. &#8220Economics dictate that we try to do as much of it together.”

Posey said he has had no problems working with Chugach. He said the two utilities also plan to work together on wind power and a joint dispatch center.

&#8220I'm the most cooperative guy in the Railbelt,” Posey said.

Dianne Porter, public relations analyst for Golden Valley Electric Association, in the Fairbanks area, also said she believes it is important for co-ops to work together. Though Golden Valley produces 255 megawatts of its own power, Porter said her utility takes into account other co-ops before adding generation.

&#8220What does the state need, and how do we meet those needs first?” Porter said. &#8220What are the needs of the overall Railbelt, and how do we meet those needs?”

But MEA's Babcock said the dynamics are different for MEA, which is the only co-op in Alaska without generation capacity.

&#8220Reliability demands we have local generation,” he said.

The local generation MEA wants is in the form of two 100 megawatt generators built in the Mat-Su Valley - a base-load generator powered by coal and a gas-powered peak generator.

The power project is on a fast track to be completed in time for the end of MEA's contract with Chugach in 2015. MEA plans to select a site for the generators in May or June.

This generation would replace the power currently drawn from Chugach Electric. MEA is the largest wholesale customer of Chugach Electric, purchasing 26 to 27 percent of total Chugach production, Babcock said.

The issue is central to the ongoing election for MEA board of directors, with incumbents largely favoring the management approach, and challengers offering a different course, including a renewed effort to work together with other Railbelt utilities.

Both Homer and MEA have given letters to Chugach Electric expressing they don't plan to be the same kind of customers as in past, according to Chugach's Steyer.

&#8220The don't intend to renew their existing contracts,” he said.

Chugach's other power purchasers are Seward Electric Association, Homer Electric Association, Anchorage Municipal Light and Power and, at times, Golden Valley.

This is a process that has gone on for the last five years or more, Babcock said.

&#8220Which is ample time for other utilities to propose to build plants within the Mat-Su,” Babcock said, adding that MEA does not want to help build plants outside its service territory.

Babcock said MEA members should be skeptical of Chugach Electric's doubts that MEA can be its own power producer.

&#8220You cannot expect Chugach at this time to say anything positive to encourage building our own power,” he said.

&#8220Right now, the best reality for them is to try to stop us from going forward.

&#8220When push comes to shove, are they going to make sure there is power in Palmer and Wasilla, or Anchorage? It's going to be Anchorage.”

Contact Russell Stigall at

352-2267 or russell.stigall@ frontiersman.com