SWANS ISLAND — The new year is likely to bring sharply lower electricity rates to residents here and in Frenchboro.
The staff of the Maine Public Utilities Commission (PUC) was scheduled to meet today (Thursday) with officials of the Swans Island Electric Cooperative (SIEC) and regional power provider Emera Maine to work out the details of Emera’s acquisition of the SIEC.
“After that meeting, the whole package must go to the PUC commissioners for final approval,” SIEC General Manager Jeffrey Ellison said Monday.
The co-op’s board of trustees and a large majority of its members voted last year to pursue a merger agreement with Emera. Officials of the two utilities negotiated the terms of the deal, which they presented to the PUC.
“We’ve had several meetings and conference calls with the PUC,” Ellison said. “They brought up a few issues that we are working on [with Emera], but there’s nothing that seems to be a show-stopper. So, it looks like it will go through.”
The two utilities had set a goal of switching SIEC customers to Emera by the end of this year. Ellison said that is still feasible.
As Emera customers, most residential electricity users on the two islands would pay about 47 percent less than they do now. Large residential customers would see a reduction of about 41 percent. Commercial customers would pay about 33 percent less.
Currently, the SIEC buys electricity from Emera at the standard price. But there is the added cost of transmitting it to Swans Island and Frenchboro from the co-op’s meter in Bernard on Mount Desert Island. Also increasing users’ costs is “line loss,” the amount of electricity that is lost in transmission to the islands. The SEIC has said it typically experiences a 16 percent line loss.
With Emera, island customers will not have to bear those additional costs because the PUC requires utilities to charge all of their customers the same rates regardless of where they are.
Along with lowering rates for Swans Island and Frenchboro customers, Emera will acquire the SIEC’s debt, which is about $1.8 million.
To cover increasing costs, including the costs associated with absorbing the SIEC, Emera has asked the PUC to authorize an across-the-board rate increase of about 9 percent for all of its Maine customers. If that is approved, electric customers on the two islands would see a reduction in the amount of money they save as a result of the Emera acquisition.
“It would still be a substantial savings for us on the islands,” Ellison said.
In addition to covering the higher costs of power transmission, customers on the two islands have been paying the salaries of three full-time SIEC staff members and six part-time employees. Ellison and accountant/bookkeeper Bonnie Turner will be retiring, and billing supervisor Karen Griffin has accepted a job as administrative assistant to the Swans Island Board of Selectmen. Ellison is a member of the board.
SIEC officials have said the major disadvantage of being absorbed by Emera, in addition to the loss of six part-time jobs for island residents, would be delays in the resumption of service in the event of a power outage. Emera would not have any personnel based on Swans Island or on Frenchboro. And scheduling work by independent electrical contractors also could take longer.
Ellison said the most challenging and time-consuming part of satisfying the PUC’s requirements for the “asset purchase agreement” between the SIEC and Emera has been getting customers to sign utility easements.
“There was one property with a line going across it that supplied the whole housing development, and 14 people owned that piece of property,” he said. “Only one or two of them live on the island; the rest are scattered around Maine. So getting all of those easements involved going to the various towns, knocking on doors and getting them to sign.
“It was a monumental project. Karen Griffin kept leading that charge and did an incredible job.”
The SIEC, which has been providing electricity to island residents since 1949, currently has about 460 customers with 546 meters.
“We have a fairly substantial number of people who have more than one meter,” Ellison said. “Some of the fishermen have a meter on their home and one on their workshop.”
Updated on Dec. 5 at 10:22 a.m.