By SUZANNE DOWNING
July 3, 2026 – Southeast Conference, Southeast Alaska’s federally designated Economic Development District and the state’s designated Alaska Regional Development Organization, is facing calls for independent state and federal review after board records show it officially intervened against a proposed hydroelectric project at the request of one of its own board officers.
At issue is the Sweetheart Lake Hydroelectric Project, a proposed 19.8-megawatt renewable energy development south of Juneau that supporters say would become the largest new hydroelectric project built in the United States since 1994. The project is designed to reduce diesel generation in the Juneau area while providing long-term renewable energy for industrial customers.
The controversy is not over whether the project should ultimately be built. Rather, it centers on whether Southeast Conference followed appropriate governance, conflict-of-interest procedures, stakeholder participation and independent due diligence before taking an official position against one of the region’s largest proposed economic development projects.
The dispute comes at a time when the federal government has declared a National Energy Emergency and is encouraging domestic energy development, including expanded hydropower production.
Yet Southeast Conference, whose mission is to promote economic development across Southeast Alaska, officially opposed the project before the Federal Energy Regulatory Commission.
Juneau Hydropower Inc. has now formally requested investigations by both the US Economic Development Administration and the Alaska Department of Commerce, Community, and Economic Development into Southeast Conference’s actions.
According to Southeast Conference’s own board minutes, the issue first came before the board during its May 22 meeting when Treasurer Alec Mesdag presented concerns regarding Juneau Hydropower’s federal licensing matter and requested that Southeast Conference submit comments to FERC. Staff was directed to prepare a draft letter for board review.
Mesdag also serves as president and chief executive officer of Alaska Electric Light & Power, the Juneau utility that had already filed its own opposition to Juneau Hydropower’s request before FERC, according to the complaint submitted to federal officials.
The board met again in a special session on June 1 to review the proposed filing.
According to the minutes, Board President Katie Koester, who is also the Juneau City Manager, said she had asked staff to “soften” the tone of the original letter while maintaining concerns about the project’s business case. The minutes also acknowledge that the board was “not privy to the internal contracts and finances of JHI,” yet the board proceeded to discuss financing, customer commitments and long-term project viability before approving comments questioning those very issues.
That acknowledgment has become one of the central issues raised in Juneau Hydropower’s requests for outside review.
The company argues Southeast Conference never contacted Juneau Hydropower before taking its official position, never requested supporting information directly from the developer, and never sought an opportunity to hear the company’s side before filing comments with the federal licensing agency.
The complaint further argues the board did not request an independent cost analysis, did not seek documentation supporting Alaska Electric Light & Power’s assertions, did not review Juneau Hydropower’s response before acting, and did not document any recommendation from Southeast Conference’s Energy Committee before intervening in the licensing proceeding. Those allegations now form part of the governance questions the company is asking state and federal officials to examine.
The dispute is particularly notable because it appears to place Southeast Conference’s action in tension with its own published strategic plan.
As Southeast Alaska’s federally designated Economic Development District, Southeast Conference recently adopted its 2030 Comprehensive Economic Development Strategy after a planning process involving more than 400 participants. The plan identifies reducing energy costs, increasing deployment of renewable energy, expanding energy infrastructure and improving regional economic resilience among its priorities.
Supporters of the Sweetheart Lake project argue it advances many of those same objectives by expanding renewable generation while reducing diesel use and improving long-term energy security for Southeast Alaska.
Juneau Hydropower also points to previous proceedings before the Regulatory Commission of Alaska, where commissioners unanimously determined the company was fit, willing and able to operate as a regulated public utility after reviewing engineering studies, financial information, contracts and expert testimony. The company questions whether Southeast Conference independently reviewed that public record before reaching contrary conclusions regarding the project’s viability. That issue is also raised in the requests for outside review.
The company says support for the Sweetheart Lake project has come from the Juneau Downtown Business Association, the Access Alaska Coalition, labor organizations and officials within the Dunleavy administration who support the jobs and energy infrastructure associated with the project.
The requests for review also ask oversight agencies to examine Southeast Conference’s governance in light of its role as a publicly funded regional development organization that administers state and federal economic development programs. The complaints ask regulators to review the organization’s conflict-of-interest procedures, decision-making process, stewardship of public funds and compliance with the responsibilities that accompany its designations as both an Economic Development District and an Alaska Regional Development Organization.
The controversy has already raised broader questions about how publicly funded economic development organizations should operate. Should they intervene in disputes between competing private enterprises? What level of due diligence should be expected before taking an official position? And when one of their own board officers asks the organization to intervene in support of his company’s position, what conflict-of-interest safeguards should apply?
Those are the questions now facing Southeast Conference and potentially the state and federal agencies responsible for overseeing its public mission.
2 thoughts on “Southeast Conference under scrutiny after board backs AEL&P in fight over Juneau hydropower project”
Forget Denmark, something (else) is rotten in Juneau. 🐟🐟🐠🐠
Haven’t we seen this kind of thing before? I’m thinking Chugach Electric and the Fire Island wind farm and Golden Valley Electric and the Healy coal plant and at least one other generation system. I’m also thinking Homer Electric and its own bumbling.
The utilities simply cannot see beyond their own noses and do everything they can to sabotage something they didn’t think of, driving up its costs and ultimately the costs that you and I pay.