May 08, 2013
Wednesday

SEAPA is unique in all of America. There really is nothing quite like it anywhere. SEAPA is a monopoly power generation and power distribution organization on a closed system that services three communities on three different islands in an archipelago in Southeast Alaska. It’s far and away a most unique situation in the hydro community that needs a consultant’s perspective to insure we are meeting the best interests' of the people we serve and represent.

 We have a critical shortage of affordable hydro generation facing mostly, if not entirely, the community of Ketchikan. We have many differing paths we could take to meet those needs and we are almost  entirely relying SEAPA to meet those needs going forward as the regional energy developer for Ketchikan, Wrangell and Petersburg.  I have substantive concerns about SEAPA’s “Call for Power”.

As you know Wrangell and Petersburg have first dib’s on Tyee Lake power and Ketchikan has first call on Swan Lake Power. Some of the pundits have suggested the ever-increasing power needs of our northerly neighbors will result in the end of surplus power exports to Ketchikan from Tyee Lake in as soon as 10 years. At that point the intertie becomes almost useless as a conduit for energy from Tyee to Ketchikan, but it may be an avenue for energy sources yet to be developed in Alaska or Canada. That said, ten years in hydro development terms, is one project from inception to completion if the project is fast-tracked. We have zero northerly hydro projects in the planning and development to continue exports to Ketchikan at this time, and except for Whitman, we have nothing in hydro development on our end at present either. In the next 10 years, we’re likely to  be burning diesel fuel in ever-increasing amounts as a result of this shortfall-(as much as 200 dollars per month per household).  

SEAPA is basing our future energy needs on a Black and Veach study that calls for 2-3% power demand growth per annum.  Presently, our power demands are growing at that rate just as predicted. The problem there is we already have exceeded our ability to produce all the hydro power we need and we have been using the diesel generators to the tune of 2.75 million dollars this year alone. Ketchikan, not Wrangell and Petersburg have been burning the diesel.  Additionally, and more to the point, we are not building enough power generation into our “Call for Power “for any new large scale industry (mining, saw mills, fish processing, ship building). That’s a huge mistake for our community and region. We have the available resources, but not the collective wisdom to develop them. Examples would be: Mahoney Lake, Metlakatla intertie and all of Metlakatla available potential hydro resources. Nor should we rule out the potential benefit of  completing a connection to the British Columbia power grid. This is just one additional option that the proposed, independent review could bring to the table. The BC intertie is not even on the table for discussion.

SEAPA has modeled its “Call for Power” to minimize its financial exposure and maximize its revenues from its existing assets off Swan and Tyee.  That’s great for the entity of SEAPA, but it is terrible for you and me. It reduces available power for future, yet to be determined, industry and relegates us in Ketchikan to burning diesel as the load growth in the northerly communities grow and Tyee Lake hydro exports shrink, then ultimately vanish. We talk about the ability to get funding and build hydro projects and SEAPA says they are the ones to do that.

This year the City of Ketchikan is receiving about 35 million dollars in capital funding requests not to mention the last years funding we applied for and received for our Whitman lake project.  Whitman is going to be the third hydro project we have designed and built. Many forget that KPU is a mature, well established, very competent utility with about a century of customer service experience and project development experience as well. We are just as competent and some would say more competent than our recent up-start, SEAPA. This year SEAPA’s capital requests to the Legislature were not funded.

 I think we would be better off to be in control of our own energy needs. I’m not alone in this assessment. I think an independent study would bear this out, or confirm that the arrangement we now have with SEAPA  can’t be beat. Then again, we could be forever stuck with a monopoly energy provider more concerned with its bottom line than yours and mine. There are more issues involved in the decision as to whether SEAPA is the answer to our future power needs than the lay-person can reasonably assimilate.  We’d be remiss and derelict in our duty as policy makers not to do this study considering the possible consequences for our rate-payers. I will be bringing this study back for your consideration with a more defined scope of work.  

Sam Bergeron,
Ketchikan City Council and SEAPA Board member
Ketchikan, Alaska

Representations of fact and opinions in letters are solely those of the author.
The opinions of the author do not represent the opinions of Sitnews.