Anchorage weighs Eklutna water deals after utilities decline to back its bid for a vote

The Anchorage Assembly holds a public hearing Tuesday on whether to approve three agreements governing the city's drinking water from Eklutna Lake without a condition it attached in December: that Chugach Electric Association and Matanuska Electric Association back the city's bid to regain its vote on the Eklutna Hydroelectric Project. The utilities declined.

The city owns 53.33% of the hydro project but gave up its operating and voting rights in 2020, according to the governor's 2024 decision, Alaska News has reported. The Assembly's December approval required Chugach and MEA to commit in writing to support, before the Regulatory Commission of Alaska, the city hydropower utility's effort to regain an equal vote. They did not, according to a memo from Mayor Suzanne LaFrance, and the case is now on appeal in Alaska Superior Court, leaving the condition "now impossible to fulfill." Her administration recommends approving the agreements without it. The ordinance first came before the Assembly Oct. 6.

The agreements matter because the same lake powers the hydro plant and supplies most of Anchorage's water. AWWU, the city's water utility, draws about 90% of Anchorage's public water supply from Eklutna Lake, according to the ordinance. Under a 1984 deal, it pays the project's owners about $1.2 million a year to offset power the project loses to those withdrawals. The new agreement caps what AWWU owes Chugach for lost power at $600,000 a year, adjusted for inflation, and gives AWWU the option to seek priority water rights at the lake in 2055.

The agreements also set terms for the owners to use AWWU infrastructure under the Fish and Wildlife Program Gov. Mike Dunleavy issued in October 2024. Chugach and MEA have backed releasing water into the Eklutna River and weighing fish passage later, while the Native Village of Eklutna wants continuous flow across all 12 river miles and fish passage into and out of the lake, Alaska News has reported.

The governor's program also directed the parties and the tribe to study pumped storage hydropower as an alternative. If pumped storage is selected, the new water agreements would not take effect, the memo says. If it is not, and the program uses AWWU's infrastructure, "these are good terms for the Municipality," the memo states. The city holds a public meeting on the pumped storage study Oct. 28 in Chugiak.