October 21, 2026

PALMER, Alaska — Matanuska Electric Association (MEA), ENSTAR Natural Gas Company (ENSTAR), and Hilcorp Alaska (Hilcorp) have signed a gas exchange agreement involving 1.2 billion cubic feet of natural gas that will help support regional winter energy reliability while providing approximately $2 million in estimated savings for MEA members, subject to regulatory approval and implementation.

Under the agreement, gas volumes already under contract to MEA but not required for its near-term generation needs will be made available to ENSTAR to help address regional winter supply challenges. ENSTAR will return equivalent gas volumes to MEA no later than March 31, 2028.

The agreement is expected to provide approximately $1.3 million in avoided carrying costs that benefit MEA's base rates and an additional $700,000 in Cost of Power Adjustment savings through avoided gas storage injection fees. The COPA is the portion of members’ electric bills that reflects fuel and purchased power costs - MEA’s largest expense, accounting for about 35 cents of every dollar the cooperative spends. These savings are expected to be realized between 2027 and 2029.

“This agreement demonstrates how utilities can work together to address regional energy challenges while delivering value to the people we serve,” said Tony Izzo, CEO of MEA. “By making use of gas volumes that are not needed for MEA’s near-term operations, we can support regional winter reliability, make more efficient use of existing energy infrastructure, and reduce costs for our members.”

The agreement reflects a collaborative effort among Southcentral Alaska energy providers to maximize the use of existing Cook Inlet gas resources and storage infrastructure during a period of continuing regional gas supply constraints. The fully executed agreement has been submitted by ENSTAR to the Regulatory Commission of Alaska for review with a request for expedited consideration.

MEA has secured 100% of the natural gas needed to serve our members this winter, and this agreement will not affect MEA’s ability to generate the power our members rely on. During prolonged extreme cold, the regional natural gas system can face challenges delivering enough gas at the pressure needed to meet heating and electricity demand. By increasing gas available to the regional energy system during periods of peak winter demand, this agreement is expected to help reduce the likelihood of conditions that could require rolling service interruptions. While no single agreement eliminates that possibility, this is another step utilities are taking together to help keep homes warm and power reliable this winter.

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