HEA members vote against deregulation

(Image Courtesy of HEA)

Homer Electric Association members voted overwhelmingly against deregulation, and the cooperative will remain under the oversight of the Regulatory Commission of Alaska. About 70 percent of voters said they wanted the RCA, the agency which oversees public utilities in Alaska, to continue the practice. HEA officials made the announcement Dec. 21.

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Mike O’Meara, an HEA rate-payer and outspoken critic of deregulation, said members sent a clear message to HEA’s management through the vote.

“They don’t trust the management to conduct business in the appropriate way without oversight from the RCA, and unregulated monopolies are just generally a bad idea for the consumer,” O’Meara said.

The cooperative is the sole provider of electricity to nearly 23,000 members on the Kenai Peninsula. Almost one third of the membership voted.

HEA’s nine-member Board of Directors voted unanimously in April to hold the deregulation election. This October, members received ballots with their electric bills.

O’Meara said HEA’s management and board need to do more outreach to members, and he suggested informal listening sessions. He said the vote shows that HEA’s management and board are not on the same page as the people they serve.

“The vote is a very good example of that. This is evidence that they were totally out of touch with what the wider membership felt,” O’Meara said.

Bruce Shelley, Director of Member Relations for HEA, said the relatively large voter turnout highlights one of the values of the cooperative model — enabling members to provide direction to their utility.

“HEA is very, very pleased by the voter turnout,” Shelley said. “It is such an important decision. We are a cooperative and we live by a cooperative model, and this definitely showed, unlike a monopoly, the cooperative model enables members to provide direction to their utility.”

Shelley said the cooperative will not pursue deregulation of HEA’s generation and transmission subsidiary – Alaska Electric Energy Cooperative or AEEC — which holds the lion’s share of HEA debt that ratepayers must pay off.

Under the rules, HEA would have had to hold a separate deregulation election for its subsidiary.

HEA officials couldn’t say exactly how much holding the deregulation vote and the campaign for it cost, but Shelley estimated it cost approximately $98,000 with promotional materials, ballots and mailing.

RCA officials say it cost the commission $11,000 to have the ballots counted. Under Alaska statute, the cooperative won’t be able to hold another deregulation election for two years.

Daysha Eaton is a contributor with the Alaska Public Radio Network.

Daysha Eaton holds a B.A. from Evergreen State College, and a M.A. from the University of Southern California. Daysha got her start in radio at Seattle public radio stations, KPLU and KUOW. Before coming to KBBI, she was the News Director at KYUK in Bethel. She has also worked as the Southcentral Reporter for KSKA in Anchorage.

Daysha's work has appeared on NPR's "Morning Edition" and "All Things Considered", PRI's "The World" and "National Native News". She's happy to take assignments, and to get news tips, which are best sent via email.

Daysha became a journalist because she believes in the power of storytelling. Stories connect us and they help us make sense of our world. They shed light on injustice and they comfort us in troubled times. She got into public broadcasting because it seems to fulfill the intention of the 4th Estate and to most effectively apply the freedom of the press granted to us through the Constitution. She feels that public radio has a special way of moving people emotionally through sound, taking them to remote places, introducing them to people they would not otherwise meet and compelling them to think about issues they might ordinarily overlook.

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