Sale of ML&P to Chugach approved by the RCA, with conditions
The Regulatory Commission of Alaska has approved the sale of Anchorage-owned Municipal Light & Power to Chugach Electric Association, but with stipulations.
Friday, Mayor Ethan Berkowitz was joined by Anna Henderson, General Manager of Municipal Light and Power to talk about the sale that is conditionally approved.
“The RCA found the deal to be in the public interest,“ said Berkowitz.
He added there were conditions in the RCA order that will take some time for the Municipality and ML&P to go through.
Berkowitz said he had spoken with Chugach Electric following the announcement of the approval.
“We both hope we that we can continue to move forward with this, and it is a monumental day and a monumental achievement.”
Chugach Electric CEO Lee Thibert said the utility is still looking through the stipulations.
“We are still reviewing the order and the conditions imposed by the RCA to determine whether they are acceptable to Chugach,” Thibert wrote.
“Assuming they are, we look forward to moving toward closing and a smooth transition for existing Chugach members and the new members from the ML&P system.”
Henderson says ML&P doesn’t expect rates to go up for consumers.
“I can’t speak definitely to what rates will do in the future, however, the commission also fully recognized the savings and the benefit to the community that this transaction will bring,” said Henderson. “So the expectation is that, consistent with our original message to the community, that we don’t expect rates to increase as a result of this transaction.”
ML&P customers could expect changes to their bill in the near future says Henderson.
“The commission ordered that Chugach file certain rate adjustments within I believe 90 days of close. So there should be some change to the bill that customers notice in pretty short order.”
Henderson added there would be other rate adjustments in a couple of years.
The mayor added some of the rate changes will be downward, meaning possibly lower bills.
“But none of these rate changes are going to be implemented until the deal is done, and the deal's not done because the RCA put a number of conditions in place,” said Berkowitz. “Conditions that are going to require further negotiations between various parties. As well as it’s going to take time for us to evaluate the impact of those conditions on the cost of doing the deal.”
The sale was approved by voters back in April of 2018. According to a joint press release from the MOA and Chugach Electric. Chugach filed for approval on April 1, 2019, according to the press release. After several weeks of hearings that started in August, the two utilities reached a settlement, which included a purchase price of $972.8 million."
Both the mayor and Henderson acknowledge the sale isn’t a done deal. More work will need to be done by all parties.