04/14/1999 08:07 AM House URS

                   JOINT MEETING                                                                                                
  HOUSE SPECIAL COMMITTEE ON UTILITY RESTRUCTURING                                                                              
         SENATE LABOR & COMMERCE COMMITTEE                                                                                      
                   April 14, 1999                                                                                               
                     8:07 a.m.                                                                                                  
                                                                                                                                
COMMITTEE CALENDAR                                                                                                              
                                                                                                                                
PRESENTATION: CH2M HILL FINAL REPORT BY KARL RABAGO                                                                             
                                                                                                                                
HOUSE BILL NO. 183                                                                                                              
"An Act relating to the powers and duties of the chair of the                                                                   
Alaska Public Utilities Commission; relating to membership on the                                                               
Alaska Public Utilities Commission; and relating to the annual                                                                  
report of the Alaska Public Utilities Commission."                                                                              
                                                                                                                                
     - SCHEDULED BUT NOT HEARD                                                                                                  
                                                                                                                                
TAPE(S)                                                                                                                         
                                                                                                                                
99-14, SIDES A&B                                                                                                                
99-15, SIDE A                                                                                                                   
                                                                                                                                
CALL TO ORDER                                                                                                                   
                                                                                                                                
Representative Hudson, Chairman, convened the Joint House Special                                                               
Committee on Utility Restructuring and Senate Labor & Commerce                                                                  
Committee meeting at 8:07 a.m.                                                                                                  
                                                                                                                                
PRESENT                                                                                                                         
                                                                                                                                
House Special Committee on Utility Restructuring members present at                                                             
the call to order were Representatives Hudson, Cowdery, and Davies.                                                             
Representative Rokeberg arrived at 8:25 a.m. and Representatives                                                                
Berkowitz and Green [alternate to Representative Porter] arrived at                                                             
8:27 a.m.  Representative Kott was not present.  Senate Labor &                                                                 
Commerce Committee member(s) present was Senator Loren Leman.                                                                   
                                                                                                                                
OTHERS PRESENT                                                                                                                  
                                                                                                                                
Karl Rabago, Consultant, CH2M HILL; Tom Feiler, EIC.                                                                            
                                                                                                                                
SUMMARY OF INFORMATION                                                                                                          
                                                                                                                                
KARL RABAGO, Consultant, CH2M HILL, presented an overview of the                                                                
findings and recommendations regarding the electric utility                                                                     
restructuring study for the State of Alaska.  Mr. Rabago reviewed                                                               
a handout entitled, "Electric Utility Restructuring Report to the                                                               
Alaska Legislature and the Alaska Public Utilities Commission."  He                                                             
noted that the full report can be accessed via the Internet.  Mr.                                                               
Rabago presented three possible scenarios regarding utility                                                                     
restructuring which are detailed in the report.  He discussed                                                                   
stranded costs and what Alaska faces in that respect.  Mr. Rabago                                                               
discussed the ability of Alaska to restructure, the benefits of                                                                 
such, and the costs of restructuring.                                                                                           
                                                                                                                                
TOM FEILER, EIC, explained the reasoning behind the use of the                                                                  
modeling exercise, its objectives, and its results.  He reviewed                                                                
the cases that were ran.  Mr. Feiler stressed that computer                                                                     
modeling of competitive markets are analytic tools intended to                                                                  
inform judgement.  Furthermore, computer modeling is sensitive to                                                               
initial assumptions and variables which are listed in the                                                                       
aforementioned handout.  There was discussion regarding the                                                                     
comparison of the study provided to the committee with the Black                                                                
and Beech (ph) study.  Mr. Feiler discussed how prices are                                                                      
determined.                                                                                                                     
                                                                                                                                
COMMITTEE ACTION                                                                                                                
                                                                                                                                
The committee took no action.                                                                                                   
                                                                                                                                
ADJOURNMENT                                                                                                                     
                                                                                                                                
The meeting recessed to the call of the chair at 10:05 a.m.                                                                     
                                                                                                                                
NOTE:                                                                                                                           
                                                                                                                                
The meeting was recorded and handwritten log notes were taken.  A                                                               
copy of the tape(s) and log notes may be obtained by contacting the                                                             
House Records Office at 130 Seward Street, Suite 211, Juneau,                                                                   
Alaska  99801-1182, (907) 465-2214, and after adjournment of the                                                                
second session of the Twenty-first Alaska State Legislature, in the                                                             
Legislative Reference Library.