Anchorage's water utility could own the rights to most of the city's tap water in 2055

Anchorage's water utility could own the rights to most of the city's drinking water starting in 2055, under a deal the Assembly approved 12-0 Tuesday.

Right now it doesn't. About 90% of Anchorage's tap water comes from Eklutna Lake, and the rights to that water belong to the owners of the hydroelectric project there: the city, Chugach Electric Association and Matanuska Electric Association.

"We have to pay the hydro owners for our water," Allison Lang, assistant general manager of the Anchorage Water and Wastewater Utility, told the Assembly. That's about $1.2 million a year, and part of it goes to the city's own hydropower utility, Alaska News reported Oct. 5.

Under the new agreement, the utility could take ownership of those rights in 2055. Until then, what it pays Chugach would be capped at $600,000 a year, plus inflation.

"Owning that water eliminates an expense that right now all our ratepayers pay," Lang said.

In the same package, the hydro owners would get to use the utility's pipes to send water back into the Eklutna River, under a fish and wildlife program Gov. Mike Dunleavy set in 2024.

The Assembly first approved the deal in December, but only if Chugach and MEA backed Anchorage's bid to regain the vote on the hydro project it gave up when it sold Municipal Light & Power. They didn't, state regulators ruled against the city and the city is appealing. Tuesday's vote dropped the condition.

Some members wanted two more weeks. Municipal Attorney Eva Gardner warned of a "low level of trust" with the other owners and said the deal could "go away." The motion to wait was withdrawn.

"This is a big deal," said Assembly Chair Anna Brawley.

It could still fall apart. If the governor picks a pumped storage hydropower project at Eklutna instead, a decision Gardner said is expected around October 2027, the agreements won't take effect. The Native Village of Eklutna, which wants fish back in the river, wasn't consulted on this round, she said.