AEDC encourages Chugach Electric, ML&P to discuss possible merger
Nobody likes receiving a pricey electric bill. The Anchorage Economic Development Corporation (AEDC) says some power rates around the city have gotten so high, they’ve actually started to hurt businesses.
“I know for a number of commercial properties in Anchorage, they have seen their electric bills go up tens of thousands of dollars on a monthly basis,” AEDC President and CEO Bill Popp said.
AEDC formed a working group of local business leaders to look at how to improve the problem.
They met four times over the last year and on Wednesday sent a letter to Chugach Electric Association (CEA) and Municipal Light and Power (ML&P), asking the two utilities to enter into discussions about a potential merger.
“There is no guarantee that this will work. What we believe is that there is a potential that it could have benefits but we don’t know until we have a much more in depth, high level conversation between the utilities and the city,” said Popp.
Cost savings are the main drivers behind the push that Popp says could help consumers, but ML&P says not so fast.
“We are always looking for ways to save our customers money. A merger could be part of that conversation, but [I] don’t think its necessarily going to be the panacea that the letter seems to address,” ML&P general manager Mark Johnston said.
ML&P is already working closely with Chugach Electric on efforts like the Southcentral power project, Beluga River gas unit and power pulling.
“You could merge all six utilities in Anchorage and I don’t think you are going to see huge savings,” Johnston said.
The idea of a merger is nothing new. Both ML&P and Chugach Electric officials say it’s something that has been brought up several times during the last three decades, but always ruled out in the end.
Still, Chugach Electric officials say they’re happy to at least have the discussion AEDC is asking for.
“If there are other opportunities to save money by doing more together then we’ll talk about it. What’s that going to look like in the end? We don’t know,” Chugach Electric spokeswoman Julie Hasquet said.
Any merger would have to prove a benefit to consumers of both utilities, and until the electric companies can determine that, the AEDC proposal remains only an idea.
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