EWEB OKs Negotiations on Potential Power Transfer

The Eugene Water & Electric Board commissioners have authorized the utility’s general manager to negotiate and execute agreements with Lane Electric Cooperative as part of an ongoing study into a possible realignment of electric service territory in the McKenzie Valley.

The decision, approved at the board’s December meeting, marks a key milestone in a joint evaluation by the two utilities to determine whether transferring electric service for about 3,000 customers between Thurston Road and Vida from EWEB to Lane Electric would improve efficiency, reliability and use of resources.

EWEB officials said the review reflects differences in how the two utilities are structured. EWEB is designed primarily to serve a dense, urban customer base, while Lane Electric specializes in providing power to rural, low-density areas such as the McKenzie Valley.

“This realignment would allow EWEB to do what we do best and Lane Electric to serve upriver customers in a way that better serves customer needs,” said EWEB Commissioner Mindy Schlossberg.

Schlossberg also pointed to governance as a concern for McKenzie Valley customers. Because they live outside Eugene city limits, they cannot vote for representatives on the EWEB board. Lane Electric’s cooperative structure would provide customers with direct, elected representation, she said.

“The concern I hear the most from upriver residents is a desire for direct, elected representation. A territory realignment would provide that,” Schlossberg said.

The potential transfer would involve electric service only. EWEB’s power generation assets and its agreements related to drinking water source protection would not be affected.

EWEB officials said the McKenzie Valley is significantly more expensive for the utility to serve than its urban territory. Remote access to infrastructure, heavier vegetation management needs and longer travel times for field crews contribute to higher costs. A recent cost-of-service analysis found that providing electric service in the valley costs about 21 percent more than the revenue collected from customers there.

Under normal circumstances, those findings could support creating a separate upriver rate class. However, because a service transfer is under consideration, EWEB will apply the same electric rate adjustment to all customers beginning in February 2026. With the newly adopted rates, most residential electric bills are expected to increase by about $3 to $6 per month, depending on usage.

If the proposed transfer does not move forward, EWEB management is expected to ask the board to approve higher rates for the McKenzie Valley to better align charges with the cost of service.

Draft agreements between EWEB and Lane Electric are now under development, with both utilities emphasizing a collaborative approach. If the evaluation ultimately supports a transfer, the utilities would negotiate terms covering asset valuation, power-supply arrangements and the transfer of customer accounts, with a target service-transfer date of May 1, 2026.

Even if electric service is transferred, EWEB will continue to operate and maintain its water and generation assets in the upper McKenzie.

“The McKenzie River is a legacy part of EWEB and has shaped our organization for more than 100 years,” said Commissioner John Barofsky. “The valley and watershed remain our number-one source of drinking water, and we will continue to invest in its protection for the well-being of valley residents and the community of Eugene.”