Nebraska Power Review Board presented with conflicting arguments on proposed merger

Advocates tout benefits to central Nebraska development, while detractors say it will hurt water users and irrigators

By: - February 15, 2023 12:56 pm
center pivor

Irrigation canals operated by Central help recharge groundwater that in turn provides ample supplies for center-pivot irrigation systems in the central Platte Valley. Irrigators expressed concern about losing power over their water resources in a merger. (courtesy of the Central Nebraska Public Power and Irrigation District)

LINCOLN — A state utilities board was given starkly different opinions Wednesday about the potential impact of merging two central Nebraska power districts.

An attorney representing the Central Nebraska Public Power and Irrigation District said the proposed merger with the Dawson Public Power District continues a “visionary path” begun decades ago when waters of the Platte River were first diverted for irrigation.

“(Central) has reliably and consistently delivered vital water for irrigation to benefit agriculture, our state’s most important industry,” said Kurth Brashear, a lawyer representing Central.

Power Review Board
Members of the Nebraska Power Review Board began hearing arguments Wednesday over the proposed merger of the Central Nebraska Public Power and Irrigation District with Dawson Public Power. (Paul Hammel/Nebraska Examiner)

The president of the Central board, David Rowe, who farms near Darr, testified that merging with Dawson would ensure that hydropower generated by Central would be used locally for the benefit of economic development and jobs.

‘Very exciting’

“It’s very exciting for central Nebraska,” Rowe said.

But an attorney for irrigators protesting the merger said that it’s a lopsided deal, with little benefit for Central or irrigators.

Michael Degan, who represents Citizens Opposed to the Merger, said that the interests of irrigators served by Central can conflict with interests of retail power customers served by Dawson. Under a merged board via the new Platte River Public Power and Irrigation Districts, representatives of water users will be in the minority, he said.

‘No benefit’ for merger

“My clients like Central and the way it is,” Degan said. “There’s no need for this merger, there’s no benefit to this merger.”

Wednesday marked the beginning of three days of hearings before the Nebraska Power Review Board on a merger that will have major ramifications for central Nebraska from Kearney to Ogallala, as well as the rest of the state.

Central, based in Holdrege, operates Kingsley Dam, which forms the state’s largest recreational reservoir, Lake McConaughy. It also manages a series of lakes and canals that serve more than 1,000 surface water irrigators, but also has created a huge mound of underground water south of the Platte River utilized by hundreds of center-pivots.

Dawson, headquartered in Lexington, sells power to thousands of retail customers, including many irrigators. It doesn’t deliver water for irrigation, nor does it generate power, so it buys electricity from others.

Cash reserve vs. debt

Central generates hydropower at Kingsley Dam and three other sites, generating revenue to offset the cost of delivering water. It has created a $100 million cash reserve for Central; by comparison, Dawson has more than $50 million in debts outstanding.

Facing the expiration of contracts to sell power on the open market, Rowe said that Central began discussions with its neighbor, Dawson, about a proposed merger.

Those discussions began three years ago and resulted in a consultant’s report that estimated a merger could save an estimated $11.7 million for the two districts over seven years.

But on Wednesday, Degan argued that most of those benefits would go to Dawson, not to Central customers.

“There’s practically no value here for Central,” he said.

Brashear disputed that, saying that the two districts would be “stronger together” if they merged and that water interests would continue to be protected.

Irrigators, he said, were wrong to conclude that they will lose “local control.”

Brashear said that local elected officials, on five separate occasions, have voted to move forward with the merger, which is local control.

“Opponents don’t seem to recognize reality,” he told the five members of the Power Review Board.

Testimony is expected to continue into Friday.


Our stories may be republished online or in print under Creative Commons license CC BY-NC-ND 4.0. We ask that you edit only for style or to shorten, provide proper attribution and link to our web site.

Paul Hammel
Paul Hammel

Senior Reporter Paul Hammel has covered the Nebraska state government and the state for decades. Previously with the Omaha World-Herald, Lincoln Journal Star and Omaha Sun, he is a member of the Omaha Press Club's Hall of Fame. He grows hops, brews homemade beer, plays bass guitar and basically loves traveling and writing about the state. A native of Ralston, Nebraska, he is vice president of the John G. Neihardt Foundation.