The Green Lake dam, pictured here in a file photo, is one of two hydro projects operated by the City of Sitka. Fees for hydro projects that occupy federal land could go up under a proposed rule change.
The federal government wants to more than double the fees it charges Sitka to use land for hydroelectric projects.
The Federal Energy Regulatory Commission, or FERC, charges money on a per-acre basis for the parts of Sitka’s two hydroelectric projects that occupy federal land.
This year, the fees were around $11 an acre. That comes out to about $23,000 for Blue Lake, and $15,000 for Green Lake. Under changes proposed by FERC, Blue Lake’s fees could be upward of $46,000 and Green Lake’s could increase to more than $36,000.
Brewton says it would be bad news for Sitka, and its rate payers, and that Sitka is joining a number of utilities across the state to protest the move.
Under yet another methodology, FERC would base Sitka’s rates off of the value of agricultural land, determined by the National Agricultural Statistics Service, or NASS. Brewton says that would put the rate upwards of $1,100 an acre, which works out to $3.2 million for both lakes.
Brewton says it’s possible, but not probable.
“I can’t imagine that FERC would go through with the NASS method, and try to raise our fees from $30,000 or $40,000 to upward of $3.4 million,” he said. “That just would not pass the light of day test.”
The city argues that one of its projects – Green Lake – isn’t even on federal land, but rather lands that were conveyed from the federal government to the state under the statehood act.
Brewton will brief the Assembly on the proposed fee change at Tuesday’s regular meeting. He says he’s not asking for the Assembly to take any action, but that if the federal government does increase the land-use fees, the city will likely ask for help from the state’s Congressional delegation.
