On March 1, 2005, the Anchorage Assembly adopted certain revisions to Section 21.90, Utility Distribution Facilities, of the Anchorage Municipal Code. These revisions required an electric utility to "include as part of its annual capital improvement plan, a five-year undergrounding program." In each of the years of this program the electric utility shall plan on expending "at least two percent of a three-year average of its annual gross retail revenues derived from utility service connections within the municipality". This requirement means that Chugach Electric Association (Chugach) is required to spend approximately $3.1 million annually to underground existing overhead facilities. Over expenditures or under expenditures may be carried over as an adjustment to the following year's obligation.
In the development of the five-year undergrounding program the electric utility is allowed to choose which existing lines to underground. Specifically, priorities for the program "shall be based on undergrounding in conjunction with the utility's essential system improvements and then by target areas."
The undergrounding plan lists the projects in Chugach's five-year undergrounding program. Overall, the plan calls for $22,395,000 to be expended on undergrounding existing overhead lines from 2016 to 2020, for an average of $4,479,000 annually.
The projects were chosen taking into account Chugach's overall system needs and consideration of the designated target areas. The inclusion of a project within this plan does not guarantee that the project will be constructed in the designated year.