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Standing Rock tribe to initiate utility program

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FORT YATES, N.D. - The Standing Rock Sioux Tribe is taking its first step in starting its own electric utility.

It will initiate a bill-crediting program in early January that will provide rebates to tribal members against their electric utility bills, Tribal Management Specialist Mike F. White Bull said.

The Moreau-Gran-Sou Electric Cooperative has been assisting the tribe and the Western Area Power Authority with this transfer of low-cost power. The tribe plans to have its own fully developed electric utility system in operation by 2003.

Electric power became available to tribal households on the reservation in the early 1960s. The tribal utility will serve more than 350 households on or near the reservation, White Bull said .

The tribe is working with consultants to develop a Web-based software program to integrate billing management between nearby electric cooperatives that serve tribal residents in North Dakota and South Dakota. It will assist the tribe in following the billing to its customers and making sure they receive the credits to their electric bills, White Bull said.

"We are going to be doing a rebate for people that will be about $23 per month per household. It could be more or less," White Bull said.

The tribe contracted with URS Inc., a Madison, Wis., consulting firm to help it set up a data base to keep track of billing and its customer base. Tribal residents will continue to receive power from the rural electric cooperatives that have served them in the past, at least until the tribe invests in transmission lines and other distribution equipment.

"We're going to look at doing everything a utility company does without owning transmission and distribution lines, said James F. Yockey, a consultant with URS Inc.

"It will allow them to develop their own power sources such as the use of renewable energy."

Tribal leaders plan to eventually buy transmission and distribution lines and investigate options for power generation using wind power - a readily available source in north central South Dakota and south central North Dakota.

Even though other tribes in the region have tried to establish their own utility authorities or companies, they report their efforts have been tied up in the courts over jurisdiction and regulatory authority.

While there have been discussions about forming a joint tribally owned utility company, none has been formed in the Northern Plains region.

Yockey said it would be far easier for each tribe to pursue its own venture.

"I really think the best place to start is each of the individual tribes forming their own authority and get a tribal utility up and running - making money."

By forming the utility authorities, tribes can use revenue from the ventures to fund other resources for expansion instead of relying on short-term grants. While funds through the U.S. Department of Energy are available, options for expanding the utilities will require the tribes to reinvest the capital earned from its utilities as they emerge.

Once the utilities bring in revenue, Yockey said, the tribes can then look at potential for sharing resources for power generation.

However, White Bull said the investment will give a return to tribal members whose electric bills are high even though power is generated from reservoirs in the region.

When Congress passed the Energy Policy Act in 1992, it paved the way for competition in the electric power industry, first at the wholesale level and later down to the retail consumer.

The deregulation opened the doors to tribes preparing to invest in tribally owned electric utility companies much like those operated by cities across the nation. It has also fueled consideration of other business interests such as the formation of propane providers, cable and telecommunications companies.

Yockey said propane distribution would be one avenue the Standing Rock Sioux Tribe may pursue readily.

"There is no reason they should be paying co-ops. They should be in control of that right now. People buy right now in the wintertime at $1 per gallon. You can buy it on the market in the summer time for about 50 cents," Yockey said.

"It is another case where you can have a tribal utility in charge of distribution, gain good marketable skills in terms of purchasing a commodity out in the market and have an infrastructure to deliver propane," he said.

White Bull said the closest propane provider is more than 25 miles away from Fort Yates and farther for some rural residents of the reservation.

Tribal leaders began talking about a utility more than five years ago, but laying the foundation for establishing a utility authority and working on an agreement with the WAPA took several years.

Yockey, who has worked with tribes in the Pacific Northwest, noted that the program being developed for Standing Rock's initial move into the utility business might serve as a model for other Northern Plains tribes pursuing similar interests.

"This is the perfect time to do it. This could serve as a model. There are nearly 270 tribes affected by this whole WAPA allocation," Yockey said.

The software being developed will allow tribal utility administrators to access information using their Web browsers. It will also allow the tribe to provide information to utility customers over the Internet and eventually allow customers to pay their utility bills online, he said.

Yockey said setting up tribal utilities will bring improved options for attracting industry to the reservation.

"If you have control of your local exchange, telecommunications and propane, businesses that are looking to locate have some of cheapest power in the state of North Dakota. You have people who are willing to work and you have a situation that is set up for a perfect economic development environment," Yockey said.

"We've been fortunate to have a cooperative co-op. That is the key. We have people who are willing to train some of our people, " White Bull said.

Although some electric power wholesalers require utility customers, cooperatives and utility companies to own a distribution system to be eligible for service, they have relaxed policies to allow tribally owned utilities greater access. They generally look at such utilities on a case by case basis because they are more likely to serve large, sparsely populated areas with fragmented distribution systems, the men said.

As the tribes move forward to develop their own utility companies, their utility authorities will look at purchasing nearby distribution and transmission lines. Standing Rock tribal officials are already investigating possibilities.

White Bull said the tribe will eventually have its own lines, invest in the maintenance equipment and explore potential methods to generate its own power using renewable sources in addition to the power it receives from its Missouri River hydropower allocation.

The Rosebud Sioux Tribe, which recently completed an agreement with WAPA, is preparing to regulate utilities and telecommunications services on its reservation. The tribal utility commission has been studying wind power as potential source for sale of electric power to wholesale markets.