AzGT CEO Supports Bill to Increase Western Area Power Administration Transparency
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For Immediate Release
April 20, 2016
(WASHINGTON) — Arizona Generation and Transmission Cooperatives (AzGT) CEO Patrick Ledger today told a House Natural Resources subpanel that legislation is needed to improve transparency at the Western Area Power Administration (WAPA). In testimony before the Subcommittee on Water, Power and Oceans, Ledger said he supports a bill (H.R. 1869) that would help move WAPA and other federal power marketing administrations in that direction.
AzGT, a not-for-profit wholesale power and transmission provider for six member co-ops in the southwest, receives power and transmission services from WAPA.
“AzGT has generally succeeded in managing external threats and controlling costs, with one exception—WAPA,” Ledger said. “We can no longer rely on this supplier in ways we once did. Instead, WAPA has become one of our more serious risks. In recent years, WAPA has imposed rate increases with little correlation to market fundamentals and with little explanation of any kind.”
Ledger noted that rate and transparency issues can be particularly problematic for electric co-ops. “Unlike investor-owned utilities, every cost impact on rural cooperatives or public power utilities is passed directly through to our customers—residents of rural areas who are already struggling,” he said.
Ledger said that HR 1869, the Environmental Compliance Cost Transparency Act, would help address the informational gap by requiring WAPA to disclose compliance costs associated with federal environmental laws impacting the conservation of fish and wildlife. This would give AzGT and other customers a better understanding of the true cost of the resource they are buying from WAPA.
“Indeed, this legislation would provide valuable insight into an important cost driver that has affected WAPA’s power marketing in recent years,” Ledger said. He added that in recent months, WAPA has taken limited steps on its own to improve the transparency of its operations.
The National Rural Electric Cooperative Association is the national service organization that represents the nation’s more than 900 private, not-for-profit, consumer-owned electric cooperatives, which provide service to 42 million people in 47 states.