Five Alaska utilities are finally doing themselves what the Legislature and at least one former governor couldn't get them to do -- join together in a cooperative entity that could substantially reduce costs and provide seamless power generation for hundreds of thousands of customers in the Railbelt.

The Alaska Railbelt Cooperative Transmission and Energy Company or ARCTEC is the new version of GRETC, the Greater Railbelt Energy and Transmission Corp. that died in the Legislature earlier this year.

ARCTEC is moving forward without Anchorage Municipal Light and Power, but the Railbelt's five other utilities have signed on. They include Chugach Electric Association, Matanuska Electric Association, Homer Electric Association, Golden Valley Electric Association in Fairbanks and the Seward municipal electric department. Individual utilities are naming representatives to the ARCTEC board which is slated to hold its first meeting Jan. 7.

Joe Griffith, general manager of the Matanuska Electric Association, calls ARCTEC "GRETC lite" but says the utilities have long had a need to join together to achieve efficiencies and buying power, for instance when it comes to negotiating with natural gas suppliers for electric generation.

Griffith envisions a day, still years off, when Railbelt utilities would be combined into a single power company, and customers would receive service from a single regional provider.

"My dream would be that in time this institution would become the main provider and purveyor of future big generation and transmission projects," Griffith, a longtime Alaska utility manager, said.

Now, the six Railbelt utilities administer about 850 megawatts of power. Griffith points out that's about the same power needed to run two densely packed New York City blocks, a load easily handled in most other places by a small utility. Dividing up that small electric generation so many ways results in inefficiency and other problems, he believes.

"Too many little hands in the cookie jar," is how Griffith puts it.

ARCTEC could soon step into the political process as one big hand, wielding clout with lawmakers and state officials as a unified voice. For now, Griffith and the others have their eyes on the proposed Susitna River hydroelectric project, an idea that has been languishing for decades because the cost of natural gas was cheap enough to derail the economics of a major dam on one of the state's most-used rivers. Now gas prices are high and utilities and state officials are looking around for a less expensive and long-term energy supply.

The Susitna project is being pushed to the fast track by Gov. Sean Parnell, who recently unveiled a 2012 budget proposal that includes more than $65 million for planning, design and permitting work.

Phil Steyer, government and corporate communications manager for Chugach Electric Association, said ARCTEC is an organization that will evolve over time. For now, though, it provides a forum for utilities to "talk out the issues and come to agreement on regional priorities and regional planning to make the best use of regional resources."

"It could own projects," Steyer said. "It just won't on its first day."

Steyer and others point to the Bradley Lake hydro project west of Anchorage as a successful model for utilities working cooperatively to share power up and down the Railbelt. A project management committee made up of utility executives and state officials oversaw the project, and ARCTEC could play a similar role in future projects, like Susitna, he said.

"The state may own a project but choose this organization to operate it," Steyer said.

Jim Posey, general manager of ML & P, said tax consequences the city would face is the reason his utility chose not to join ARCTEC. "A cooperative functionally doesn't work for us," he said, essentially because the city can take advantage of a tax-exempt status for financing projects and the coop cannot.