A push by the Wrangell Assembly to move forward sooner rather than later on an analysis of the Southeast Alaska Power Agency hit a roadblock Thursday when the Ketchikan City Council rescinded its support of the idea.
The SEAPA analysis is required by the end of 2014, according to an agreement that the three member communities – Ketchikan, Petersburg and Wrangell – signed when forming the agency in 2009.
Among other issues, the analysis would look into divestiture – a fancy word for breaking up the agency. Basically, each community would take over ownership, operation and maintenance of the dams that serve their needs.
SEAPA owns the two hydroelectric facilities at Swan Lake and Tyee Lake, as well as the intertie that connects the two projects. They serve the power needs of the three communities, with Swan primarily sending its power to Ketchikan, and Tyee providing electricity for Petersburg and Wrangell. The intertie allows surplus power to be sent back and forth as needed.
The Wrangell Assembly made the first move to initiate the study. Here’s Wrangell Assembly Member James Stough, explaining why: “My thought was that we would start early on it, so we would get our due diligence on it, by hiring consulting people to look into it and tell us the pros and cons, and do it in a responsible manner. I figured we should start early because those type of things take a long period of time.”
Stough said he’s concerned that SEAPA’s board members don’t seem responsive to the concerns of the communities they are meant to represent.
Ketchikan City Mayor Lew Williams III had similar concerns, which he expressed during a recent SEAPA board meeting in Ketchikan.
“The managements which I hear from have communication concerns,” he told the board. “I don’t know if it’s different people’s territory, I don’t know if it’s jealousy between management or whatever, but I know we can work it out if we start working together.”
A couple days after that meeting, Williams said his concerns had been addressed, and he didn’t believe the analysis should move forward.
Somedays after that, though, at the Ketchikan City Council meeting, Williams noted that the MOU obligates the member communities to conduct the study sometime before the end of next year.
Some City Council members disagreed. Bob Sivertsen, who also is the current SEAPA board chairman, said the MOU is not binding.
“It was to appease Wrangell at that particular juncture,” he said. “If power rates were going crazy or something was broken, it gave them an opportunity to look at it to see if there was a need to get out of it. At this particular time, I don’t see that. I don’t believe we’re obligated to follow this at this time.”
Ketchikan City Attorney Mitch Seaver said the terms of the agreement may or may not be required.
“You’d probably need to take a closer look at what was understood at the time, what the intent was at the time,” he told the Council. “To get from here to there is going to take some effort, some filling in of the details.”
Whether or not it’s a legal commitment, though, Mayor Williams said he feels obligated.
“I was part of the Council that agreed to part of this. I remember that we added this for just the reason to get Wrangell to sign on. So I’m going to at least stick with supporting looking at this,” he said. “I don’t in any shape or form think SEAPA is ever going to break up, but we did do this on the part of the community of Wrangell.”
John Hoag, A Petersburg City Council member, said Friday that he sees no merit to the idea of divestiture. In fact, he’d like the agency to move more toward expanding SEAPA, developing more inexpensive power for Southeast Alaska. He’s not sure whether an analysis is required, legally, but: “It still comes down to the fact that individual ownership of the hydro projects make no sense. These are big projects, the transmission lines connecting then have got to be managed. The need for increased power in Southeast from hydro is evident, given the cost of diesel. So I would like to see lots of cooperation. I hate to see communities bidding against each other for the ability to develop more hydro projects, when we should be working as a group to do that.”
Hoag does agree, though, that communication between SEAPA and its member communities could be improved.
Trey Acteson is the CEO of SEAPA. In a separate interview prior to the Ketchikan City Council meeting, he agreed that communication always can be better, and said that’s something he’s working on. The SEAPA board meeting in Ketchikan included presentations about various services that SEAPA provides, as well as in-depth looks at the agency’s financial strategy.
In response to the idea of divestiture, Acteson said it would be difficult for individual communities to run the hydroelectric projects with the same efficiency, or to maintain low rates.
“There’s a lot going on behind the scenes that’s very complicated, and never really gets talked about in public,” he said. “Most people just look at their 6.8 cents power rate that they’ve had for over 15 years. SEAPA provides very stable power rates, which is good for economic development. It allows businesses to appropriately plan their future, and also we do have almost the lowest power rates in the whole state right here.”
Some of the services Acteston mentioned include repair and replacement for the facilities, insurance for all the equipment, managing the flow, and planning for the future.
Whether that future includes an analysis of the power agency, though, remains unclear.
Tune in to KRBD next week (May 6-10) for additional reports on SEAPA, and more from the interview with Trey Acteson.