Anchorage has the opportunity to consolidate its two electric utilities, ML&P and Chugach Electric, paving the way for:
A consolidation between Chugach Electric and ML&P has been discussed for decades. Chugach and ML&P have adjacent service territories, making consolidation easier and more cost effective. With low interest rates, the time to make this transaction is now. The hundreds of millions of dollars that would be saved from combining the two utilities and reducing duplication make it a win-win for Anchorage.
The Anchorage Assembly’s decision to put the sale of ML&P before the voters in April is just an authorization to sell. If approved, there will be further opportunities for the public to weigh in as the city and Chugach work out a final deal. This due diligence will take several months, and a final agreement will have to be approved by the Chugach Board of Directors, the Anchorage Assembly, and the Regulatory Commission of Alaska.
A consolidation will streamline services that are now being duplicated by having two utilities. Combining technological capabilities, infrastructure, staff, and financial resources will result in cost savings over time and lower long-term electric rates for residents and businesses. There are no property tax increases, rate increases will not go up to pay for the transaction, and there will be no layoffs of Chugach or ML&P employees. Chugach has pledged to right-size through attrition.