PMAs: Taxpayer Rip-off

Fortnightly Magazine - June 15 1996
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Power marketing administrations (PMAs) suffered a setback on May 2 when the U.S. House Subcommittee on Water and Power Resources held an oversight hearing on the Pick-Sloan Eastern Division of the Western Area Power Administration (WAPA). According to a General Accounting Office (GAO) report issued that morning, about $454 million of the Division's irrigation and flood control investment in hydropower facilities will not be recoverable, because the irrigation projects will not be completed. The GAO recommended that Congress force repayment, but noted that if WPA passes the cost on to customers, the wholesale power rate could increase as much as 14.6 percent.

DC PSC RFP Technical Consultant for Formal Case (FC) No. 1156

At the hearing, Ward Uggerud, vice president for operations at Otter Tail Power Co., recalled that he first learned that PMAs were giving away free power at taxpayer expense during a secret meeting of preference customers to which he was inadvertently invited. That meeting on July 17, 1995, in Sioux Falls, SD, was held by PMA advocates opposed to the federal sale of PMAs. The main speakers: Alan Richardson of the American Public Power Association, Glenn English of the National Rural Electric Cooperative Association, and Jeff Nelson of East River Power Co-op.

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