Thursday, October 22, 2009

HEA Considers "Self Regulation"

The HEA Board is taking steps toward becoming "self regulated." What does that mean? At present HEA, like most moderate to large Alaska electric utilities, operates under the oversight of the Regulatory Commission of Alaska (RCA). The RCA was established to see that utilities adhere to state laws and regulations and operate in a fair and fiscally responsible manner. As part of it's mission, the RCA works to mitigate differences between utilities and help protect consumers. However, Alaska law allows utilities to opt out of RCA oversight by a vote of the member/ratepayers. Under self regulation, the HEA Board would be free to conduct business absent any oversight except that of the member/ratepayers (that's us).

At this month's community meetings HEA members are being asked to complete a short opinion survey (attached) regarding how they might feel about getting the coop out from under RCA purview. Of course, most members probably don't know much about the RCA or what it might mean if they vote to opt out.

This is a significant issue for all HEA members. You should become informed as quickly as possible so that you understand how such a change could affect you.

Is "self regulation" good or bad for us? That probably depends on how much confidence and trust you have in our HEA Board and management.

From discussion at Tuesday's Board meeting, it appears that a majority of the HEA Board favors moving to "self regulation." They feel that our coop could operate more efficently and cost effectively without RCA oversight. To be sure, the workings of the RCA are typically ponderous, time consuming, and sometimes frustrating. Is there anything to lose by dropping out? Perhaps not. Although one thing come to mind right away -- under "self regulation," the new Alaska net metering rule would not apply to HEA. But without more information, it's difficult to know if other problems might arise.

At Tuesday's meeting HEA Board members and General manager Janorschke discussed the importance of providing HEA members with good information about the reasons for, the process, and potential outcomes of a transition to "self regulation." Hopefully this would be more than a sales pitch.

It's up to us to require a frank and open examination of the potential risks and benefits of such an enormous change well before we are asked to vote.

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