Today, Seward’s electric utility is owned by the city. It tried to sell the utility in 2000 and 2002, though both attempts failed.
Officials at the city say the sale would be a good thing for Seward Electric’s 3,000 customers on the eastern peninsula. This week, the city council approved an amended purchase agreement that laid out the terms of the $25 million sale. Over the next month, Seward and HEA will have to convince 60% of Seward voters that the sale is a good idea. That 60% threshold has been a sticking point in the past — in 2000, voters rejected a sale to HEA by just The utilities are trying again this year, as Seward anticipates making what Utility Manager Rob Montgomery said are necessary upgrades to Seward’s transmission systems and substations.
Ultimately, after talking about those applications in executive session, city council members chose HEA. The city’s also considering a permanent fund that would put an annual contribution toward the city’s general fund, to make up for lost revenue that the city would normally get directly from Seward Electric. That money could also be invested into the utility, as needed.
Phil Kaluza, of Seward, said he’s concerned about what could happen to those fuel costs as the sun sets on HEA’s current contract with oil and gas company Hilcorp. Hilcorp provides the utility with the vast majority of its power supply and has said it “Do we really want to be selling our utility during all this uncertainty?” he said at the meeting Tuesday.