By SUZANNE DOWNING
Feb. 15, 2026 – Chugach Electric Association is moving forward with early-stage investigations into four potential hydroelectric projects in Southcentral Alaska, part of what the utility cooperative calls an effort to reduce reliance on natural gas and meet board-directed decarbonization targets.
The utility has filed preliminary permit applications with the Federal Energy Regulatory Commission and water right applications with the Alaska Department of Natural Resources to study the feasibility of projects at Canyon Creek, Godwin Creek, Boulder Creek, and Caribou Creek.
The proposed sites and expected capacities include:
-
Canyon Creek (run-of-river) – 6 megawatts
-
Godwin Creek (storage) – 16 megawatts
-
Boulder Creek (storage) – 12 megawatts
-
Caribou Creek (storage) – 18 megawatts
Chugach emphasized that the filings do not authorize construction or any land-disturbing work, but instead give the utility priority at the sites while it conducts engineering studies and outreach.
But the move comes as Southcentral Alaska faces a much more immediate and pressing problem: the region is projected to run short of locally available natural gas long before any new hydro project could realistically be permitted, financed, and built.
Hydropower development in Alaska is notoriously slow, often taking a decade or more from concept to completion. Meanwhile, the Railbelt’s natural gas supply issues are no longer theoretical. Utilities and policymakers are already warning of looming shortages.
Alex Gimarc: REAP, Chugach and solar energy that has an unknown, unquantified benefit
Unless Gov. Mike Dunleavy’s Alaska LNG export-and-instate-supply ambitions stay on schedule, the region may be forced into costly stopgap imports or alternative fuels well before hydro can provide meaningful relief.
Chugach CEO Arthur Miller said the utility sees hydropower as a dependable, long-term solution.
“As we are all focused on the energy future of Alaska, we know hydro is dependable, is the lowest cost long-term energy source for ratepayers, allows us to reduce the need for fossil fuels, and helps us meet our decarbonation goals,” Miller said.
He added that storage hydropower projects can provide grid stability and help support intermittent renewable sources like wind and solar.
Chugach began its hydro site investigation more than two years ago, surveying 158 potential locations before narrowing the list using criteria that exclude dams or diversions on anadromous fish streams.
Over the past six months, the utility said it has met with regulatory agencies, tribes, landowners, and non-governmental organizations to refine its site selection and guiding principles.
The preliminary permit and water right applications were filed Feb. 6, 2026, triggering upcoming public comment periods.
Chugach said it will spend the remainder of 2026 conducting site visits and feasibility studies, launching a public website, and continuing stakeholder engagement.
The goal, the utility said, is to identify “fatal flaws” early and eliminate projects that prove uneconomical or too disruptive.
Only remaining candidates would advance into the lengthy federal licensing or state permitting processes.
Hydropower projects are also eligible for significant federal Investment Tax Credits if construction begins by Dec. 31, 2033 — a timeline Chugach notes adds urgency to starting the study process now.
Chugach’s decarbonization targets call for reducing carbon intensity by at least 35% by 2030 and 50% by 2040, compared to a 2012 baseline, without materially harming rates or reliability.
Still, the larger question remains whether Southcentral Alaska’s energy crisis will wait for long-run solutions — or whether the region will run out of gas long before the first hydro turbine ever turns.
Chugach said more details, including an email contact for the hydro effort, will be included in its March monthly newsletter.
Chugach Electric board suspends round-up program that skimmed money from members
Chugach Electric hikes rates after warm winter and low demand — not because of high usage
6 thoughts on “Chugach Electric eyes new hydropower sites as Southcentral gas clock ticks down”
Why not cut to the chase, how much are electric bills going up, when will increases start?
Mine went up significantly immediately after MEA stood up their gas-fired plant at Eklutna, and natural gas politics promise to make it worse. I supported it at the time because I was tired of the CEA hostage situation, but now we’re hostage to Eklutna games with fish in the Eklutna River. There is no shortage of entities in line to put the screws to people. It’s all about greed and hatred. Get used to it. It isn’t going away anytime soon.
Using benchmarks from recent Alaska hydro developments (e.g., AEA reports, DOE/ORNL data adjusted for inflation to ~2026 dollars) and US averages for similar scales/types (small/medium hydro <50 MW; run-of-river vs. storage with dams/reservoirs), rough capital cost ranges are as follows:
Canyon Creek (6 MW run-of-river):
… Lower-cost type (no major storage).
… ~$6,000–$9,000/kW ($6–$9 million/MW).
… Total: $36–$54 million.
Godwin Creek (16 MW storage):
… Involves lake outlet dam for regulation; high head/precipitation but remote.
… ~$8,000–$12,000/kW ($8–$12 million/MW).
… Total: $128–$192 million.
Boulder Creek (12 MW storage):
… Similar to Godwin; dam/storage adds costs.
… ~$8,000–$12,000/kW.
… Total: $96–$144 million.
Caribou Creek (18 MW storage):
… Largest here; economies of scale help slightly.
… ~$8,000–$12,000/kW.
… Total: $144–$216 million.
Grand Total for All Four (52 MW): $404–$606 million (average ~$7,800–$11,700/kW).
For context, the new Chugach power plant [size: 200MW] in midtown (the one sucking up vast amounts of precious Cook Inlet natural gas and creating the 'fog plum' during cold winter months) had a total cost of $369MM and, the new MEA power plant [size: 170MW] in Eklutna (same sucking up vast amounts of the precious Cook Inlet natural gas) had a total cost of $316MM.
For further context, the Susitna-Watana Dam ('not-yet-built' but heavily studied) [size: 600MW+] has an estimated cost of $6B, all of which equates to $10,000/kW.
In summary, does Chugach pursue Hydroelectric projects (only! … 52MW) for an approximate cost budget of $400-$600MM that will likely take years in 'studies' – 'engineering' – 'procurement' – 'construction' with a limited 'shelf-life' or, take a new approach and pursue SMR (Small Modular Reactor) technologies (while scalable as needed for future growth) for a few more dollars per kW (probably ~$13,000/kW) and a much longer 'shelf-life' and reliably – smartly maximizing the ROI?
Hopefully, the Management types choose wisely to not only maximize ROI while also minimizing costs to rate payers while delivering consistent // reliable power 'when' needed and 'as' needed for many decades to come!
“…….take a new approach and pursue SMR (Small Modular Reactor)………”
Does Small Modular Reactor translate to Small Nuclear Disaster when the inevitable happens?
The eco-extremist BANANAS will never allow it. They’re too invested in NO!!! You can’t do anything that might lead to improvement in the standard of living above living in caves, or igloos!! They are,already prepping their,attack shysters. To file endless litigation in San Francisco
no mention of carter lake or crescent lake
city of Seward has plans, very old plans!
was the original plan to build it before Chugach connection was made.
line built to carter lake location with a bank loan, then a loan to build the hydro plant.
magic no loan for the hydro but a loan to connect to chugach electric at 38 mile.
project was started (cat road to Crescent lake) now a trail.
both could be done without impact to fish and minimal construction costs returning water to its current destination.
while Boulder creek would require miles of power line and road development (its also prone to very violent flows and dries up every winter). same can be said of godwin creek.