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Chugach/ML&P utility deal

Chugach Electric Association’s proposed acquisition of Anchorage’s city-owned Municipal Light & Power hasn’t ruf ed any feathers yet – voters will approve the city’s end of the deal in April elections – but some have raised questions about lack of transparency and how things were negotiated behind closed doors. There still isn’t any information on what other bidders offered although there were some, it was acknowledged. Consolidation of the two electric utilities serving Anchorage has a long- sought goal but the way the municipality handled this shedding of an asset is in sharp contrast to its sale years ago of the Anchorage Telephone Utility, which was a very open and competitive process.

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CIRI, Chugach in a tiff over wind

Cook Inlet Region Inc. and Chugach Electric are in a tiff over a Chugach request that CIRI fund $94,000 for costs related to expansion of submarine cable connections for CIRI’s planned Phase 2 of the Fire Island wind project. Meanwhile, a proposed CIRI contract to sell wind power to Golden Valley Electric Assoc. in Fairbanks for an initial price of 5.9 cents per kilowatt hour (kWh) fell apart after transmission charges were proposed by other railbelt utilities to move the power to Fairbanks. Golden Valley’s most recent regulatory filings indicates that it is paying an average of 8.79 cents/kWh for power purchases from other utilities.

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Fairbanks LNG construction starts

Fairbanks-based Interior Gas Utility has started construction on a 5.5 million gallon liquefied natural gas storage tank, a $50 million project. IGU is the new owner of Pentex Alaska Natural Gas, the small gas utility serving a core downtown Fairbanks area. The utility is also considering an alternative, lower-cost option concept put forth by Siemens on a new LNG plant at Houston, in the Matanuska-Susitna Borough, in lieu of building a new plant at the existing small Pentex LNG plant near Port MacKenzie, also in the Mat-Su. Siemens is working with the Knik village corporation, the landowner at the Houston site, on a possible new-technology modular LNG plant. Siemens’ modular design would allow a plant to be built in increments and to expand as the Fairbanks gas demand grows. A location at Houston also reduces the distance for highway trucking to Fairbanks and opens the possibility of shipments via the Alaska Railroad, which has tracks near the possible plant site.