October 18, 2012 | Vol. 110, No. 42

SEAPA CEO explains single plant operator for Tyee and Swan Lake

The possibility of streamlining the operations of Thomas Bay Power Authority and Ketchikan Power Utility into a single operator was brought before the Petersburg City Council Monday evening.

“The operations and management report was commissioned by SEAPA to see how we are doing with our business,” Trey Acteson said. “We are hoping to see if there are any opportunities for savings in the near future.”

Acteson also explained that with the addition of the Swan Lake and Tyee intertie, the dynamics have changed as to the management of the power resources.

“What has come out of this report is a list of observations and recommendations,” he stated. “One of the main recommendations is to go to a single operator, but it isn’t a simple task.”

According to Acteson the current structure has some flaws and challenges with multiple budgets.

“The big goal is to make some changes to help minimize the pressure on the rates,” Acteson said. “Projects are starting to age and we are doing a lot of repairing, restoring and replacing aging infrastructure.”

He explained that for the last 14 years, SEAPA has kept its rates consistent at 6.8 cents.

“My goal, as new CEO, is to try to lengthen that duration out so that we can keep those going,” Acteson stated. “SEAPA tries to look at those with a long-term perspective and provide a good vision going forward for success and this report has summarized that success.”

The current O & M contracts have not been changed since 1996 and there is no mention of the Tyee intertie or SEAPA within them.

“It is long overdue that we take a look at this,” Acteson said. “We at least need to review these contracts every five years in order to be prudent in our business.”

Council member Don Koenigs thought the report provided by D. Hittle and Associates was thorough but he had interest in just a few aspects.

“SEAPA is now in the position to potentially plan, develop and finance new hydro generating facilities,” Koenigs said. “That is a real key component, since we are maxing out on power already.”

Koenigs would also like to see, from a community perspective, an evaluation of pros and cons of SEAPA operating the facility with complete control, to know what the benefits are of SEAPA or others managing this operation.

“The first step is to make notification on the contracts,” Acteson said. “This action will start a time clock and gives the current O & M contract holders time to come up with a plan.”

The City and Borough of Wrangell will have a work session by teleconference with the Petersburg City Council to discuss this issue Monday, Nov. 5.

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