EWEB, Lane Electric discuss possible territory transfer

The Eugene Water & Electric Board and Lane Electric Cooperative are exploring a possible service territory transfer of EWEB’s McKenzie River Valley territory to Lane Electric.

Representatives of the Eugene-based public utilities have been in preliminary discussions about a potential service territory transfer for several months.

Image shows Lane Electric's current service area.

Based on a preliminary evaluation, it appears that a transfer could make technical, operational and general business sense. Over the past week, board members of EWEB and Lane Electric instructed staff to continue exploring a potential transfer.

“It’s fairly common for utilities to discuss voluntary changes to service territory that make technical, operational, business and customer sense,” said EWEB General Manager Roger Gray. “If either Lane Electric or EWEB believes such a transaction did not make sense, it would not occur. Part of evaluating what ‘makes sense’ includes customers’ view on any transfer.”

EWEB’s McKenzie River Valley territory includes almost 3,000 customers stretching from Thurston Road just outside of the Springfield city limit east to Thomson Lane near Vida. Lane Electric’s service territory generally surrounds this area on three sides, and includes the Blue River and McKenzie Bridge communities.

“While a territory transfer appears to make sense at this preliminary stage, we want to visit with EWEB’s upriver customers as well as our members to hear their thoughts about a transfer,” said Lane Electric General Manager Rick Crinklaw.

If the governing boards of each public utility authorize a transfer, it would represent a 25 percent increase to Lane Electric’s customer base. “That’s a big step, and we want to make sure our members have a chance to talk about it with us first,” Crinklaw said.

EWEB and Lane Electric plan to discuss the possible transfer with their customer-owners in September and October during regularly scheduled meetings. The utilities also plan to hold a series of upriver community information meetings to answer questions and listen to customer viewpoints on a possible transfer.

A preliminary evaluation of the possible transfer indicates some solid reasons to continue exploring what could become a beneficial transaction:

• Lane Electric and EWEB rates are very similar. Although the rate structures have some differences, actual bill impacts depending on consumption levels would be marginal.

• EWEB and Lane Electric both dispatch troubleshooters and repair crews from their respective west Eugene operations facilities, so response times would be similar.

• Lane Electric’s service model is optimized around a rural utility model. More than 95 percent of EWEB’s customers live in the city of Eugene, which makes it primarily an urban service model. Both utilities have excellent service records that stress reliability, and that would not change.

• EWEB commissioners are elected based on geo-political boundaries (city of Eugene voting wards), which means EWEB’s upriver customers are not able to vote for their utility representative. If those in the McKenzie River Valley area become Lane Electric customers, they would participate in Lane Electric elections.

The potential transfer does not include any of EWEB’s McKenzie River generation facilities, which include the Leaburg/Walterville hydro   project  and  the  Carmen-

Smith hydro project. EWEB would still retain certain transmission lines that deliver power from those generation projects.