PRELIMINARY BENCHMARKING STUDY
CHUGACH ELECTRIC ASSOCIATION
860 OTHER U.S. ELECTRIC DISTRIBUTION COOPERATIVES
by Lee Ann Gerhart, CPA (Texas)
for Citizens for an Independent Chugach Electric
April 3, 1995
From the Executive Summary:
"CEA is clearly among the least economically efficient of distribution co-ops in the United States. Labor wage rates are extremely high and there appears to be substantial overstaffing. The benefits that CEA member-ratepayers should be enjoying as residents of a resource-rich area with the nation's lowest cost natural gas input fuel cost are not being realized by CEA member-owners who pay retail electric rates above the national average.
"Results of this review indicate that a complete audit and process review of CEA operations is warranted. In the interest of the ratepayers these studies should be given high priority. Such a review should be performed by a nationally-recognized authority with benchmarking and electric utility management and redesign expertise. It should include input from Alaskan utility experts and CEA management and it should make specific operational recommendations and outline a plan to improve the economic efficiency of CEA to 1) match national norms for economic efficiency of distribution co-ops and 2) achieve improvements that would ultimately put CEA in the upper quartile of co-ops nationally in economic performance of distribution activities.
"Additionally, a study should be made to benchmark generation and transmission performance of Alaskan co-ops with ML&P and G&T co-ops and investor-owned utilities nationally and to make recommendations similar to those above."
CHUGACH CONSUMERS UPDATE (3-01) - Since the 1995 date of this report, Chugach management under the direction of the independent Chugach Consumers-endorsed boards has implemented numerous efficiencies and process improvements. Staffing levels have fallen while reliability and safety have been maintained. Nevertheless, Chugach Consumers believes further improvement is possible and appropriate to better serve Chugach members.
Portions: Executive Summary Main Report Text Only
Figure 1 -- Distribution Employee Pay as Percent of National Average of 861 Electric Co-ops Figures 2-4
Figure 5 -- Distribution Markup per KWH vs. Service Area Density Figure 6-8
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