Palmer, Alaska - MEA’s Board of Directors has approved an extension of its existing natural gas supply agreement with Hilcorp Alaska along with a companion Firm Storage Service (“FSS”) Agreement that have both been filed with the Regulatory Commission of Alaska (“RCA”) for consideration and approval. The extension secures firm Cook Inlet natural gas supply for an additional year through March of 2029.

This contract extension and FSS agreement ensures MEA continues to receive reliable, firm natural gas at costs that remain below current market prices, while also adding the ability to store gas—an important new tool for managing winter demand, supply variability, and long-term energy planning.

What This Means for MEA Members

Natural gas remains a critical fuel source for MEA,particularly during Alaska’s coldest months when electricity demand is highest. Extending the Hilcorp contract provides short-term stability and predictabilityas MEA navigates a rapidly changing energy landscape.

While MEA anticipates electric rates will graduallyincrease by approximately 5% per year as a result of this amendment, thenegotiated gas prices under this agreement remain consistently below otherrecently approved Cook Inlet gas supply contracts. This reflects MEA’scontinued efforts to manage costs responsibly and protect members fromunnecessary price increases.

If the contract amendment is approved, atypical single-phase residential member using approximately 642 kWh per monthwould see an average increase of about $7.58 per year beginning April 1, 2026,assuming all other factors remain the same. For comparison, without a firmnatural gas supply in place, MEA would be forced to rely more heavily onhigher-cost diesel generation.

New Added Benefit: Natural Gas Storage

The companion FSS agreement allows MEA to storenatural gas during lower-demand periods and draw from those reserves duringpeak winter months or after the expiration of existing firm gas supplycontracts. This added flexibility improves system reliability, improves energysecurity and helps reduce exposure to supply disruptions and short-term marketvolatility that could drive price increases.

Gas storage is a widely used reliability andcost-management tool across the utility industry and represents an importantstep forward for MEA as uncertainty around Cook Inlet natural gas suppliescontinues.

Buying Time to Evaluate Long-Term Solutions

Extending the contract through spring 2029gives MEA valuable time to continue evaluating and planning for longer-termenergy solutions, including:

·   Potentialliquefied natural gas (LNG) import and storage projects

·   Aproposed in-state natural gas pipeline

·   Additionalregional gas supply options

·   Diversifiedand renewable energy resources
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This extension allows MEA to move forwardthoughtfully and responsibly—without rushing into higher-cost or higher-riskalternatives.

“Keeping the lights on affordably and reliably for our members is always ourtop priority,” said MEA CEO Tony Izzo. “This agreement gives us dependable fuelat a reasonable cost today, while buying us time to work with our community andpartners on long-term energy solutions that make sense for Alaska and for MEAmembers.”

“This agreement reflects a collaborative approach with MEA to bring additionalgas supplies to the market during a critical period,” said Hilcorp AlaskaSenior Vice President Luke Saugier. “By extending this contract, we’re able todeploy significantly greater levels of capital directly into our fields toaccelerate gas production—resulting in increased investment and additionalwells in the Basin."

The regulatory filings related to the contract extensionand gas storage agreement will be reviewed by the Regulatory Commission ofAlaska in early 2026, and MEA will continue to keep members informed asplanning progresses.

Media Inquiries Contact:
Jennifer Castro
Sr. Co-op Communications Manager
Jennifer.castro@mea.coop
907-761-9317

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