UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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                                    FORM 10-Q

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|X|   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
      SECURITIES EXHANGE ACT OF 1934

                  For the quarterly period ended March 31, 2006

                                       OR

|_|   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
      SECURITIES EXCHANGE ACT OF 1934

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                         Commission file number 33-42125

                       CHUGACH ELECTRIC ASSOCIATION, INC.

                Incorporated pursuant to the Laws of Alaska State

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        Internal Revenue Service - Employer Identification No. 92-0014224

                    5601 Electron Drive, Anchorage, AK 99518
                                 (907) 563-7494

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Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days.

Yes |X|    No |_|

Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, or a non-accelerated filer, (as defined in Rule 12b-2 of the
Act).

Large accelerated filer |_|    Accelerated filer |_|   Non-accelerated filer |X|

Indicate by check mark whether the registrant is a shell company, as defined in
Rule 12b-2 of the Act. Yes |_|  No |X|

Indicate the number of shares outstanding of each of the issuer's class of
common stock, as of the latest practicable date.

                  CLASS                 OUTSTANDING AT MAY 1, 2006

                  NONE                              NONE

<PAGE>

<TABLE>
<CAPTION>
                                                                             Page Number
                                                                             -----------
<S>                                                                               <C>
CAUTION REGARDING FORWARD-LOOKING STATEMENTS

PART I FINANCIAL INFORMATION

Item 1.  Financial Statements (Unaudited)                                          2

         Balance Sheets, March 31, 2006 and December 31, 2005                      3

         Statements of Revenues, Expenses and Patronage Capital, Three
         Months Ended March 31, 2006 and 2005                                      5

         Statements of Cash Flows, Three Months Ended March 31, 2006 and 2005      6

         Notes to Financial Statements                                             7

Item 2.  Management's Discussion and Analysis of Results of Operations and
         Financial Condition                                                      12

Item 3.  Quantitative and Qualitative Disclosures About Market Risk               17

Item 4.  Controls and Procedures                                                  18

PART II OTHER INFORMATION

Item 1.  Legal Proceedings                                                        18

Item 1A. Risk Factors                                                             20

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds              21

Item 3.  Defaults Upon Senior Securities                                          21

Item 4.  Submission of Matters to a Vote of Security Holders                      21

Item 5.  Other Information                                                        21

Item 6.  Exhibits                                                                 22

         Signatures                                                               23

         Exhibits                                                                 24
</TABLE>


                                       1
<PAGE>

CAUTION REGARDING FORWARD-LOOKING STATEMENTS

Statements in this report that do not relate to historical facts, including
statements relating to future plans, events or performance, are forward-looking
statements that involve risks and uncertainties. Actual results, events or
performance may differ materially. Readers are cautioned not to place undue
reliance on these forward-looking statements, that speak only as of the date of
this report and the accuracy of which is subject to inherent uncertainty.
Chugach Electric Association, Inc. (Chugach) undertakes no obligation to
publicly release any revisions to these forward-looking statements to reflect
events or circumstances that may occur after the date of this report or the
effect of those events or circumstances on any of the forward-looking statements
contained in this report, except as required by law.

                          PART I FINANCIAL INFORMATION

Item 1. Financial Statements

The unaudited financial statements and notes to financial statements of Chugach
as of and for the quarter ended March 31, 2006, follow:


                                       2
<PAGE>

                       CHUGACH ELECTRIC ASSOCIATION, INC.
                                 BALANCE SHEETS
                                   (Unaudited)

<TABLE>
<CAPTION>
                      Assets                     March 31, 2006    December 31, 2005
                      ------                     --------------    -----------------
<S>                                               <C>                <C>
Utility plant:

     Electric plant in service                    $ 778,228,983      $ 762,859,198

     Construction work in progress                   18,957,011         32,505,401
                                                  -------------      -------------
         Total utility plant                        797,185,994        795,364,599

     Less accumulated depreciation                 (334,051,719)      (327,384,961)
                                                  -------------      -------------
         Net utility plant                          463,134,275        467,979,638

Other property and investments, at cost:

     Nonutility property                                 24,461             24,461

     Investments in associated organizations         11,882,980         11,883,053
                                                  -------------      -------------
         Total other property and investments        11,907,441         11,907,514

Current assets:

     Cash and cash equivalents                        9,822,561         10,650,594

     Special deposits                                   216,191            216,191

     Fuel cost under-recovery                                 0          1,781,833

     Accounts receivable, net                        25,623,828         27,436,278

     Materials and supplies                          24,239,058         23,809,691

     Prepayments                                      1,538,631          1,801,104

     Other current assets                               407,474            282,939
                                                  -------------      -------------
         Total current assets                        61,847,743         65,978,630

Deferred charges, net                                18,428,643         19,269,718
                                                  -------------      -------------

Total Assets                                      $ 555,318,102      $ 565,135,500
                                                  =============      =============
</TABLE>


                                       3
<PAGE>

                       CHUGACH ELECTRIC ASSOCIATION, INC.
                                 BALANCE SHEETS
                                   (Continued)
                                   (Unaudited)

<TABLE>
<CAPTION>
                       Liabilities and Equities                 March 31, 2006   December 31, 2005
                       ------------------------                 --------------   -----------------
<S>                                                              <C>                <C>
Equities and margins:

     Memberships                                                 $  1,260,753       $  1,250,398

     Patronage capital                                            141,240,221        136,185,378

     Other                                                          7,470,746          7,603,376
                                                                 ------------       ------------
         Total equities and margins                               149,971,720        145,039,152

Long-term obligations, excluding current installments:

     2001 Series A Bond payable                                   150,000,000        150,000,000

     2002 Series A Bond payable                                   120,000,000        120,000,000

     2002 Series B Bond payable                                    35,500,000         41,000,000

     National Bank for Cooperatives promissory notes payable       52,445,116         53,532,099
                                                                 ------------       ------------
         Total long-term obligations                              357,945,116        364,532,099

Current liabilities:

     Current installments of long-term obligations                  8,674,842          8,325,687

     Accounts payable                                               5,920,707          9,598,958

     Consumer deposits                                              2,011,319          1,980,285

     Fuel cost over-recovery                                          763,637                  0

     Accrued interest                                               2,087,680          6,360,652

     Salaries, wages and benefits                                   5,251,091          5,373,496

     Fuel                                                          17,013,916         18,123,139

     Other current liabilities                                      3,256,477          3,035,915
                                                                 ------------       ------------
         Total current liabilities                                 44,979,669         52,798,132

     Deferred credits                                               2,421,597          2,766,117
                                                                 ------------       ------------

      Total Liabilities and Equities                             $555,318,102       $565,135,500
                                                                 ============       ============
</TABLE>

See accompanying notes to financial statements.


                                       4
<PAGE>

                       CHUGACH ELECTRIC ASSOCIATION, INC.
             Statements of Revenues, Expenses and Patronage Capital
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                           Three months ended March 31
                                                                               2006              2005
                                                                               ----              ----
<S>                                                                      <C>                <C>
Operating revenues                                                       $  66,885,593      $  57,212,034

Operating expenses:
     Fuel                                                                   27,986,180         20,492,023

     Power production                                                        3,192,912          3,442,780

     Purchased power                                                         7,210,732          5,275,922

     Transmission                                                            1,391,959          1,602,140

     Distribution                                                            3,037,093          2,819,605

     Consumer accounts                                                       1,302,003          1,355,391

     Administrative, general and other                                       4,800,629          4,865,561

     Depreciation                                                            7,049,384          7,121,860
                                                                         -------------      -------------

         Total operating expenses                                           55,970,892         46,975,282

Interest expense:
     On long-term obligations                                                6,035,709          5,675,686

     On short-term obligations                                                       0              2,237

     Charged to construction-credit                                           (115,418)          (191,718)
                                                                         -------------      -------------

         Net interest expense                                                5,920,291          5,486,205
                                                                         -------------      -------------

         Net operating margins                                               4,994,410          4,750,547

Nonoperating margins:
     Interest income                                                           163,438            121,694

     Capital credits, patronage dividends and other                             30,825             35,441
                                                                         -------------      -------------

         Total nonoperating margins                                            194,263            157,135
                                                                         -------------      -------------

         Assignable margins                                                  5,188,673          4,907,682
                                                                         =============      =============

Patronage capital at beginning of period                                   136,185,378        130,750,269

Retirement of capital credits and estate payments, including
discounted capital credits transferred to other equities and margins          (133,830)          (104,493)

Patronage capital at end of period                                       $ 141,240,221      $ 135,553,458
                                                                         =============      =============
</TABLE>

See accompanying notes to financial statements.


                                       5
<PAGE>

                       CHUGACH ELECTRIC ASSOCIATION, INC.
                            Statements of Cash Flows
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                         Three months ended March 31
                                                                                             2006             2005
                                                                                             ----             ----
<S>                                                                                     <C>               <C>
Operating activities:
         Assignable margins                                                             $  5,188,673      $  4,907,682

Adjustments to reconcile assignable margins to net cash provided by operating
activities:
         Depreciation and amortization                                                     7,787,269         7,841,322
         Capitalized interest                                                               (159,056)         (226,563)
         Write off of deferred charges                                                       345,899                 0
         Other                                                                               (12,683)             (597)

         Changes in assets and liabilities:
       (Increase) decrease in assets:
         Accounts receivable                                                               1,812,450         2,474,563
         Fuel cost under-recovery                                                          1,781,833                 0
         Materials and supplies                                                             (429,367)         (141,180)
         Prepayments                                                                         262,473          (782,137)
         Other assets                                                                       (124,535)         (120,081)
         Deferred charges                                                                   (348,782)         (635,272)
       Increase (decrease) in liabilities:
         Accounts payable                                                                 (3,678,251)       (3,773,387)
         Consumer deposits                                                                    31,034            22,060
         Fuel cost over-recovery                                                             763,637          (597,884)
         Accrued interest                                                                 (4,272,972)       (4,284,022)
         Salaries, wages and benefits                                                       (122,405)          276,437
         Fuel                                                                             (1,109,223)           47,648
         Other liabilities                                                                   220,562            46,319
                  Deferred credits                                                          (774,665)          (38,458)
                                                                                        ------------      ------------
                  Net cash provided by operating activities                                7,161,891         5,016,450

Investing activities:
         Extension and replacement of plant                                               (1,926,136)       (2,980,785)
                                                                                        ------------      ------------
                  Net cash used in investing activities                                   (1,926,136)       (2,980,785)

Financing activities:
         Repayments of long-term obligations                                              (6,237,828)       (5,392,777)
         Memberships and donations received/Other equities and margins                      (122,275)           53,847
         Retirement of patronage capital and estate payments, including discounted
           capital credits transferred to other equities and margins                        (133,830)         (104,493)
         Net receipts (refunds) of consumer advances for construction                        430,145          (317,634)
                                                                                        ------------      ------------
                  Net cash used in financing activities                                   (6,063,788)       (5,761,057)

Net change in cash and cash equivalents                                                     (828,033)       (3,725,392)

Cash and cash equivalents at beginning of period                                        $ 10,650,594      $ 10,465,004
                                                                                        ------------      ------------

Cash and cash equivalents at end of period                                              $  9,822,561      $  6,739,612
                                                                                        ============      ============

Supplemental disclosure of cash flow information - interest expense paid, excluding
   amounts capitalized                                                                  $  5,750,359      $  9,770,227
                                                                                        ============      ============
</TABLE>

See accompanying notes to financial statements.


                                       6
<PAGE>

                       CHUGACH ELECTRIC ASSOCIATION, INC.
                          Notes to Financial Statements
                                   (Unaudited)

1. Presentation of Financial Information

During interim periods, Chugach Electric Association, Inc. (Chugach) follows the
accounting policies set forth in its audited financial statements included in
Form 10-K filed with the Securities and Exchange Commission (SEC) unless
otherwise noted. Users of interim financial information are encouraged to refer
to the footnotes contained in Chugach's Form 10-K when reviewing interim
financial results. The accompanying unaudited interim financial statements
reflect all adjustments of normal and recurring nature, which are, in the
opinion of management, necessary for a fair statement of the results for the
interim periods presented.

2. Lines of credit

Chugach maintains a line of credit of $7.5 million with CoBank, ACB (CoBank).
The CoBank line of credit expires October 31, 2006, subject to annual renewal at
the discretion of the parties. At March 31, 2006, there was no outstanding
balance on this line of credit and it was not utilized during the first quarter
of 2006. At March 31, 2006, the borrowing rate would have been 6.40% and at
December 31, 2005, the borrowing rate would have been 5.95%. In addition,
Chugach has an annual line of credit of $50 million available at the National
Rural Utilities Cooperative Finance Corporation (NRUCFC). At March 31, 2006,
there was no outstanding balance on this line of credit and it was not utilized
during the first quarter of 2006. At March 31, 2006, the borrowing rate would
have been 6.65% and at December 31, 2005, the borrowing rate would have been
6.10%. The NRUCFC line of credit expires October 15, 2007.

3. Legal Proceedings

Matanuska Electric Association, Inc., v. Chugach Electric Association, Inc.,
Superior Court Case No. 3AN-99-8152 Civil

In this action filed in 1999, Matanuska Electric Association, Inc. (MEA) alleged
that Chugach breached the Power Sales Agreement under which Chugach is obligated
to sell MEA power for 25 years, from 1989 through 2014. MEA asserted that
Chugach failed to provide it certain information, failed to properly manage
Chugach's long-term debt, and failed to bring Chugach's base rate action to a
Joint Committee before presenting it to the Regulatory Commission of Alaska
(RCA). All of MEA's claims were dismissed by the Superior Court.

On April 29, 2002, MEA appealed to the Alaska Supreme Court the Superior Court's
dismissal of its claims related to Chugach's financial management and Chugach's
decision not to bring its base rate action to the Joint Committee before filing
with the RCA. Chugach cross-appealed the Superior Court's decision not to also
dismiss the financial management claim on jurisprudential and res judicata
grounds. The Alaska Supreme Court, on October 8, 2004, issued an order upholding
Chugach's right to not bring its base rate action to the Joint Committee before
filing with the RCA. But the Court rejected Chugach's cross-appeal and


                                       7
<PAGE>

                       CHUGACH ELECTRIC ASSOCIATION, INC.
                          Notes to Financial Statements
                                   (Unaudited)

reversed the Superior Court's decision dismissing MEA's financial management
claim. The Supreme Court remanded that claim to the Superior Court for further
proceedings.

On January 24, 2005, Chugach filed for summary judgment on that claim asserting
that in the 2000 Test Year rate case the RCA had fully reviewed and decided the
prudency of Chugach's financial management. In a decision dated August 22, 2005,
the Superior Court granted Chugach's summary judgment motion, finding that the
RCA had adjudicated the question of Chugach's financial management and that its
decision should be given res judicata effect. The Superior Court also found that
the RCA had exercised its primary jurisdiction in reviewing Chugach's financial
management, and that its decision should be given deference.

The Superior Court entered final judgment on November 10, 2005, after which
Chugach sought its costs and fees. On December 14, 2005, the Superior Court
entered judgment awarding Chugach fees and costs from MEA in the amount of
$104,732, which has not, as yet, been recorded in the financial statements.

On December 9, 2005, MEA appealed to the Alaska Supreme Court the Superior
Court's grant of summary judgment. On December 23, 2005, Chugach cross-appealed
the Superior Court's failure to also grant summary judgment based on the
doctrine of collateral estoppel. This appeal is pending. Management is uncertain
of the outcome of the proceeding before the Supreme Court. In the opinion of
management, the outcome will unlikely have a material adverse effect on our
results of operations, financial condition or liquidity. No reserves have been
established for this matter.

Matanuska Electric Association, Inc. v. Chugach Electric Association, Inc.,
Superior Court Case No. 3AN-04-11776 Civil

On October 12, 2004, MEA filed suit in Superior Court alleging that Chugach had
violated its bylaws in allocating margins (capital credits) during the years
1998 through 2003. The margins Chugach earns each year are allocated to the
customers who contributed them and are booked as capital credits to those
customers' accounts. Capital credits are eventually repatriated to customers at
the discretion of the board of directors, typically many years after the margins
are earned.

On February 17, 2006, MEA filed a Motion to File an Amended Complaint and an
Amended Complaint in this case. The Amended Complaint is identical to MEA's
initial Complaint except for changes made to accommodate one new claim. The new
claim challenges Chugach's failure to provide MEA with a capital credit
allocation for 2004. We expect the Court will allow MEA's proposed amendment.

In this suit, MEA asks the Court to hold that Chugach breached its bylaws in the
manner in which it allocated capital credits in 1998 through 2003 and if the
Amended Complaint is allowed by the Court, through 2004. MEA also asks the court
to enjoin Chugach to re-calculate MEA's capital credits applying MEA's
interpretation of Chugach's bylaws and in accordance with what MEA refers to as
"generally accepted accounting practices for


                                       8
<PAGE>

                       CHUGACH ELECTRIC ASSOCIATION, INC.
                          Notes to Financial Statements
                                   (Unaudited)

nonprofit cooperatives and cooperative principles". The suit also seeks damages
in an unspecified amount to compensate MEA for the alleged breach of contract.
This matter currently is scheduled for a five-day trial beginning October 9,
2006. Management is vigorously defending against the claim. The ultimate
resolution of this matter is not currently determinable. In the opinion of
management, the outcome will unlikely have a material adverse effect on our
results of operations, financial condition or liquidity.

Chugach has certain additional litigation matters and pending claims that arise
in the ordinary course of Chugach's business. In the opinion of management, no
individual matter or the matters in the aggregate is likely to have a material
adverse effect on Chugach's results of operations, financial condition or
liquidity.

4. Regulatory Matters

Docket No. U-04-102 (Revision to Current Depreciation Rates)

In 2004, Chugach implemented new depreciation rates based on an update of the
1999 Depreciation Study utilizing Electric Plant in Service balances as of
December 31, 2002. The 2002 Depreciation Study resulted in a net impact on 2004
depreciation expense of approximately $259 thousand, which, in aggregate, was
not material to the financial statements. The 2002 Depreciation Study was
submitted to the RCA for approval on November 19, 2004, resulting in the RCA
opening a docket to review the proposed new rates. Chugach, however, implemented
the new rates effective January 1, 2004. Chugach did not request a change in
electric rates charged to customers based on the proposed revisions to
depreciation rates.

Order No. 2

On March 9, 2005, the RCA ruled in Order No. 2 that depreciation rates may not
be implemented without prior approval of the RCA. On August 8, 2005, Chugach
filed a motion proposing an implementation plan.

Order No. 8

On September 21, 2005, the RCA issued Order No. 8 denying our motion and
granting a motion filed by a wholesale customer of Chugach to enforce Order No.
2. Order No. 8 required that Chugach adjust its underlying 2004 financial
records to reflect the results as if Chugach had not implemented unapproved
rates. In November of 2005, Chugach reversed the 2004 depreciation expense and
depreciation reserves that were previously recorded using the 2002 Depreciation
Study rates and calculated 2004 depreciation expense for all categories of plant
using the 1999 Depreciation Study rates as approved by the RCA in Docket
U-01-108. The adjustment was not material to Chugach's financial statements.

Order No. 9

In Order No. 9 dated January 10, 2006, the RCA ruled substantially in Chugach's
favor approving the 2002 Depreciation Study with certain changes to the proposed
depreciation


                                       9
<PAGE>

                       CHUGACH ELECTRIC ASSOCIATION, INC.
                          Notes to Financial Statements
                                   (Unaudited)

rates. The main effect of this decision is to allow Chugach to revise its
depreciation rates effective as of January 1, 2005. The overall impact to
Chugach is an estimated decrease in annual depreciation expense of $1.0 million.
Because Chugach did not request changes to the electric rates charged to our
customers based on the proposed new depreciation rates, there was no immediate
electric rate impact. Wholesale customers MEA and Homer Electric Association,
Inc. (HEA) were active in the proceeding. MEA filed a motion for reconsideration
of the effective date of January 1, 2005, for the changes to depreciation rates
based on the RCA's ruling. In Order No. 10 dated January 26, 2006, the RCA
extended its time to rule on petitions for reconsideration to April 17, 2006.
The RCA did not rule on MEA's Motion by April 17, therefore, under the RCA's
regulations, it is our view that MEA's Motion has automatically been denied.

5. Critical Accounting Policies

Our accounting and reporting policies comply with accounting principles
generally accepted in the United States of America. The preparation of financial
statements in conformity with Generally Accepted Accounting Principles (GAAP)
requires that management apply accounting policies and make estimates and
assumptions that affect results of operations and reported amounts of assets and
liabilities in the financial statements. Significant accounting policies are
described in Note 1 to the financial statements (See "Financial Statements and
Supplementary Data."). Critical accounting policies are those policies that
management believes are the most important to the portrayal of Chugach's
financial condition and results of its operations, and require management's most
difficult, subjective, or complex judgments, often as a result of the need to
make estimates about matters that are inherently uncertain. Most accounting
policies are not considered by management to be critical accounting policies.
Several factors are considered in determining whether or not a policy is
critical in the preparation of financial statements. These factors include,
among other things, whether the estimates are significant to the financial
statements, the nature of the estimates, the ability to readily validate the
estimates with other information including third parties or available prices,
and sensitivity of the estimates to changes in economic conditions and whether
alternative accounting methods may be utilized under accounting principles
general accepted in the United States of America. For all of these policies
management cautions that future events rarely develop exactly as forecast, and
the best estimates routinely require adjustment. Management has discussed the
development and the selection of critical accounting policies with Chugach's
Audit Committee. The following policies are considered to be critical accounting
policies for the quarter ended March 31, 2006.

Electric Utility Regulation

Chugach is subject to regulation by the Regulatory Commission of Alaska (RCA).
The RCA sets the rates Chugach is permitted to charge customers based on
allowable costs. As a result, Chugach applies Statement of Financial Accounting
Standards (SFAS) No. 71, Accounting for the Effects of Certain Types of
Regulation (SFAS 71). Through the ratemaking process, the regulators may require
the inclusion of costs or revenues in periods different than when they would be
recognized by a non-regulated company. This treatment may result in the deferral
of expenses and the recording of related regulatory assets based on anticipated
future


                                       10
<PAGE>


                       CHUGACH ELECTRIC ASSOCIATION, INC.
                          Notes to Financial Statements
                                   (Unaudited)

recovery through rates or the deferral of gains or creation of liabilities and
the recording of related regulatory liabilities. The application of Statement
No. 71 has a further effect on Chugach's financial statements as a result of the
estimates of allowable costs used in the ratemaking process. These estimates may
differ from those actually incurred by the Company; therefore, the accounting
estimates inherent in specific costs such as depreciation and pension and
post-retirement benefits have less of a direct impact on Chugach's results of
operations than they would on a non-regulated company. As reflected in Note 1 to
the financial statements under "Deferred Charges and Credits", significant
regulatory assets and liabilities have been recorded. Management reviews the
ultimate recoverability of these regulatory assets and liabilities based on
applicable regulatory guidelines. However, adverse legislation and judicial or
regulatory actions could materially impact the amounts of such regulatory assets
and liabilities and could adversely impact Chugach's financial statements.

Critical estimates also include provision for rate refunds and allowance for
doubtful accounts. Actual results could differ from those estimates.

6. New Accounting Standards

SFAS 154 "Accounting Changes and Error Corrections"

This statement replaces Accounting Principles Board (APB) Opinion No. 20,
"Accounting Changes" and FASB Statement No. 3, "Reporting Changes in Interim
Financial Statements," and establishes, unless impracticable, retrospective
application as the required method for reporting a change in accounting
principle in the absence of explicit transition requirements specific to the
newly adopted accounting principle. It applies to all voluntary changes in
accounting principle, and to changes required by an accounting pronouncement in
the unusual instance that the pronouncement does not include specific transition
provisions. When a pronouncement includes specific transition provisions, those
provisions should be followed. This Statement is effective for accounting
changes and corrections of errors made in fiscal years beginning after December
15, 2005. Chugach implemented the Statement effective January 1, 2006.

SFAS 153 "Exchanges of Nonmonetary Assets"

This Statement addresses the measurement of exchanges of nonmonetary assets. It
eliminates the exception from fair value measurement for nonmonetary exchanges
of similar productive assets in APB Opinion No. 29, "Accounting for Nonmonetary
Transactions," and replaces it with an exception for exchanges that do not have
commercial substance. This Statement specifies that a nonmonetary exchange has
commercial substance if the future cash flows of the entity are expected to
change significantly as a result of the exchange. The provisions of this
Statement are effective for nonmonetary asset exchanges occurring in fiscal
periods beginning after June 15, 2005. Chugach implemented the statement
effective January 1, 2006. The implementation of the statement had no
significant impact on the financial statements.


                                       11
<PAGE>

Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations

Reference is made to the information contained under the caption "CAUTION
REGARDING FORWARD-LOOKING STATEMENTS" at the beginning of this Report.

Regulatory Matters

Docket No. U-04-102 (Revision to Current Depreciation Rates)

In 2004, Chugach implemented new depreciation rates based on an update of the
1999 Depreciation Study utilizing Electric Plant in Service balances as of
December 31, 2002. The 2002 Depreciation Study resulted in a net impact on 2004
depreciation expense of approximately $259 thousand, which, in aggregate, was
not material to the financial statements. The 2002 Depreciation Study was
submitted to the RCA for approval on November 19, 2004, resulting in the RCA
opening a docket to review the proposed new rates. Chugach, however, implemented
the new rates effective January 1, 2004. Chugach did not request a change in
electric rates charged to customers based on the proposed revisions to
depreciation rates.

Order No. 2

On March 9, 2005, the RCA ruled in Order No. 2 that depreciation rates may not
be implemented without prior approval of the RCA. On August 8, 2005, Chugach
filed a motion proposing an implementation plan.

Order No. 8

On September 21, 2005, the RCA issued Order No. 8 denying our motion and
granting a motion filed by a wholesale customer of Chugach to enforce Order No.
2. Order No. 8 required that Chugach adjust its underlying 2004 financial
records to reflect the results as if Chugach had not implemented unapproved
rates. In November of 2005, Chugach reversed the 2004 depreciation expense and
depreciation reserves that were previously recorded using the 2002 Depreciation
Study rates and calculated 2004 depreciation expense for all categories of plant
using the 1999 Depreciation Study rates as approved by the RCA in Docket
U-01-108. The adjustment was not material to Chugach's financial statements.

Order No. 9

In Order No. 9 dated January 10, 2006, the RCA ruled substantially in Chugach's
favor approving the 2002 Depreciation Study with certain changes to the proposed
depreciation rates. The main effect of this decision is to allow Chugach to
revise its depreciation rates effective as of January 1, 2005. The overall
impact to Chugach is an estimated decrease in annual depreciation expense of
$1.0 million. Because Chugach did not request changes to the electric rates
charged to our customers based on the proposed new depreciation rates, there was
no immediate electric rate impact. Wholesale customers MEA and HEA were active
in the proceeding. MEA filed a motion for reconsideration of the effective date
of


                                       12
<PAGE>

January 1, 2005, for the changes to depreciation rates based on the RCA's
ruling. In Order No. 10 dated January 26, 2006, the RCA extended its time to
rule on petitions for reconsideration to April 17, 2006. The RCA did not rule on
MEA's Motion by April 17, therefore, under the RCA's regulations, it is our view
that MEA's Motion has automatically been denied.

Results Of Operations

Current Year Quarter Versus Prior Year Quarter

Operating revenues, which include sales of electric energy to retail, wholesale
and economy energy customers and other miscellaneous revenues, increased by $9.7
million, or 16.9%, for the quarter ended March 31, 2006, over the same quarter
in 2005. The increase in revenues was due to an increase in revenue recovered
through the fuel surcharge mechanism due to higher fuel prices, as well as
increased retail and wholesale kWh sales. With regard to retail sales, the
Municipality of Anchorage, our primary service area, experienced average
economic growth in the first quarter of 2006, compared to the same period in
2005. With regard to wholesale revenue, actual sales increased due to increased
job growth and continued state and federal spending, which generated additional
economic activity. Based on the results of fixed and variable cost recovery
established in Chugach's last rate case, wholesale sales to MEA, HEA and Seward
contributed approximately $7.0 million and $6.7 million to Chugach's fixed costs
for the quarter ended March 31, 2006 and 2005, respectively. The following table
shows the base rate sales revenue and fuel and purchased power revenue by
customer class that is included in revenue for the quarters ended March 31,
2006, and 2005.

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------

                       Base Rate Sales Revenue       Fuel and Purchased Power Revenue            Total Revenue
-----------------------------------------------------------------------------------------------------------------------
                      2006      2005   % Variance     2006       2005      % Variance      2006      2005    % Variance
-----------------------------------------------------------------------------------------------------------------------
<S>                  <C>       <C>       <C>         <C>         <C>           <C>        <C>       <C>        <C>
-----------------------------------------------------------------------------------------------------------------------
Retail
Residential          $13.3     $13.3       0.0%      $ 7.6       $ 5.4         40.7%      $20.9     $18.7       11.8%
Small Commercial     $ 2.3     $ 2.3       0.0%      $ 1.5       $ 1.1         36.4%      $ 3.8     $ 3.4       11.8%
Large Commercial     $ 7.2     $ 7.2       0.0%      $ 6.3       $ 4.4         43.2%      $13.5     $11.6       16.4%
Lighting             $ 0.3     $ 0.4     (25.0%)     $ 0.0       $ 0.0          n/a       $ 0.3     $ 0.4      (25.0%)
Total Retail         $23.1     $23.2      (0.4%)     $15.4       $10.9         41.3%      $38.5     $34.1       12.9%

Wholesale
HEA                  $ 2.6     $ 2.6       0.0%      $ 5.2       $ 4.0         30.0%      $ 7.8     $ 6.6       18.2%
MEA                  $ 5.5     $ 5.1       7.8%      $ 8.8       $ 5.8         51.7%      $14.3     $10.9       31.2%
SES                  $ 0.2     $ 0.3     (33.3%)     $ 0.5       $ 0.5          0.0%      $ 0.7     $ 0.8      (12.5%)
Total Wholesale      $ 8.3     $ 8.0       3.8%      $14.5       $10.3         40.8%      $22.8     $18.3       24.6%

Economy Sales        $ 1.4     $ 1.4       0.0%      $ 3.6       $ 2.8         28.6%      $ 5.0     $ 4.2       19.0%
Miscellaneous        $ 0.6     $ 0.6       0.0%      $ 0.0       $ 0.0          n/a       $ 0.6     $ 0.6        0.0%

Total Revenue        $33.4     $33.2       0.6%      $33.5       $24.0         39.6%      $66.9     $57.2       17.0%
-----------------------------------------------------------------------------------------------------------------------
</TABLE>


                                       13
<PAGE>

The following table represents kWh sales for the quarter ended March 31:

                                                    2006             2005
                                                    ----             ----
                   Customer                          kWh              kWh
              Retail                            331,871,496      329,374,667
              Wholesale                         330,602,415      327,634,824
              Economy Energy                     88,938,040       95,825,850
                                                -----------      -----------
              Total                             751,411,951      752,835,341
                                                ===========      ===========

Retail demand and energy rates and wholesale demand and energy rates charged to
HEA, MEA and Seward Electric System (SES) did not change in the first quarter of
2006 compared to the first quarter of 2005.

Fuel expense increased by $7.5 million, or 36.6%, for the quarter ended March
31, 2006, compared to the same period in 2005 primarily due to higher fuel
prices. For the quarter ended March 31, 2006, Chugach used 7,108,027 MCF of fuel
at an average effective price of $4.20 per MCF, which does not include 446,856
MCF of fuel that is recorded in purchased power. For the same period in 2005,
Chugach used 7,213,745 MCF of fuel at an average effective price of $3.10 per
MCF, which does not include 610,835 MCF of fuel recorded in purchased power.
Purchased power also increased $1.9 million, or 36.7%, due in part to higher
fuel prices, as well as the unavailability of a unit Chugach is contractually
obligated to purchase power from due to maintenance in the first quarter of
2005. In the first quarter of 2006, Chugach purchased 128,040 MWH of energy at
an average effective price of 5.37 cents per kWh. For the same period in 2005,
Chugach purchased 140,096 of energy at an average effective price of 3.55 cents
per kWh. Chugach purchased more from Bradley Lake in the first quarter of 2005
compared to 2006, which resulted in lower MWH purchased in 2006. Fuel and
purchased power is collected through the fuel surcharge mechanism. Production
expense decreased $249.9 thousand, or 7.3%, for the three-month period ended
March 31, 2006, compared to the same period in 2005, primarily due to labor
associated with retirements. Transmission expense decreased by $210.2 thousand,
or 13.1%, and distribution expense increased by $217.5 thousand, or 7.7%, due
primarily to the timing of maintenance, as well as additional distribution
maintenance caused by outages due to weather conditions in the first quarter of
2006. Distribution expense also increased due to higher installation costs for
meters and transformers. Consumer Accounts/Information, administrative, general
and other and depreciation and amortization expense did not materially change
for the three-month period ended March 31, 2006.

Interest on long-term debt increased by $360.0 thousand, or 6.3%, due to higher
interest rates on the variable CoBank and 2002 Series B bonds. Interest charged
to construction decreased by $76.3 thousand, or 39.8%, due primarily to lower
debt balances in the first quarter of 2006 compared to 2005.

Other nonoperating margins increased $37.1 thousand, or 23.6%, for the
three-month period ended March 31, 2006, compared to the same period in 2005 due
to an increase in interest income associated with higher interest rates on our
investment account. Allowance for funds used during construction (AFUDC),
increased, primarily due to a higher equity balance used


                                       14
<PAGE>

in the calculation of AFUDC, which is calculated based on a three-year average.
In 2005, AFUDC was calculated using Chugach's 2002 loss as a component of the
three-year calculation.

Financial Condition

Total assets decreased $9.8 million, or 1.7%, from December 31, 2005, to March
31, 2006. The decrease was due in part to a $4.8 million, or 1.0%, decrease in
net plant, primarily due to depreciation expense in excess of extension and
replacement of plant. The decrease in total assets was also due to a $828.0
thousand, or 7.8%, decrease in cash and cash equivalents caused, in part, by the
semi-annual interest payment on the 2001 and 2002 Series A Bonds and the
principal payment on the 2002 Series B Bonds in the first quarter, as well as a
$1.8 million, or 100%, decrease in fuel cost under-recovery, caused by the
collection of the previous quarter's fuel and purchased power costs through the
fuel surcharge mechanism. The decrease was also due to a $1.8 million, or 6.6%,
decrease in accounts receivable caused by the collection on receivables that
were accrued but not paid at December 31, 2005. Deferred charges also decreased
$841.1 thousand, or 4.4%, due primarily to three months of amortization of
deferred charges.

Notable changes to total liabilities and equities include a decrease of $6.2
million caused by the reclassification of and installment payments on the 2002
Series B bond and the CoBank 3 bonds. Accounts payable also decreased $3.7
million, or 38.3%, as a result of the payment of invoices that were accrued but
not paid at December 31, 2005. Fuel payable also decreased $1.1 million, or
6.1%, caused by a decrease in fuel consumption from December 31, 2005. Accrued
interest also decreased $4.3 million, or 67.2%, as a result of the semi-annual
interest payment on the 2001 and 2002 Series A Bonds in the first quarter.
Deferred credits also decreased $344.5 thousand, or 12.5%, due to reduced
refundable deposits.

These decreases were offset by a $4.9 million, or 3.4%, increase in patronage
capital due to the margins generated in the first quarter of 2006, as well as a
$763.6 thousand, or 100%, increase in fuel cost over-recovery caused by the over
collection of the previous quarter's fuel and purchased power costs through the
fuel surcharge mechanism.

Liquidity and Capital Resources

Chugach has satisfied its operational and capital cash requirements primarily
through internally-generated funds, an annual $7.5 million line of credit with
CoBank and a $50 million line of credit from NRUCFC. At March 31, 2006, there
was no outstanding balance with NRUCFC or CoBank.

Chugach also has a term loan facility with CoBank. Loans made under this
facility are evidenced by promissory notes governed by the Master Loan
Agreement, which became effective on January 22, 2003. At March 31, 2006,
Chugach had the following promissory notes outstanding under this facility:

                                       15
<PAGE>

Promissory        Principal   Interest rate at     Maturity      Principal
   Note            balance     March 31, 2006        Date      Payment Dates
   ----            -------     --------------        ----      -------------

CoBank 2         $ 9,000,000        5.50%            2010       2005 - 2010
CoBank 3         $19,604,225        6.40%            2022       2003 - 2022
CoBank 4         $22,015,733        6.40%            2022       2003 - 2022
CoBank 5         $ 5,000,000        6.40%            2007          2007

 Total           $55,619,958

On January 22, 2003, Chugach and CoBank finalized a new Master Loan Agreement
pursuant to which the CoBank term loan facility was converted from secured to
unsecured debt and the obligations represented by the outstanding bonds then
held by CoBank were converted into promissory notes governed by the new Master
Loan Agreement. Chugach's mortgage indenture was replaced in its entirety by an
Amended and Restated Indenture dated April 1, 2001. All liens and security
interests imposed under the indenture were terminated and all outstanding
Chugach bonds (including new bonds of 2001 Series A, 2002 Series A and 2002
Series B) became unsecured obligations governed by the terms of the Amended and
Restated Indenture.

Capital construction in 2006 is estimated at $30.8 million. At March 31, 2006,
approximately $1.9 million had been expended. Capital improvement expenditures
are expected to increase in the upcoming second quarter as the construction
season begins.

Chugach management continues to expect that cash flows from operations and
external funding sources will be sufficient to cover operational and capital
funding requirements in 2005 and thereafter.

Outlook

None

Environmental Matters

Compliance with Environmental Standards

Chugach's operations are subject to certain federal, state and local
environmental laws. The costs associated with environmental compliance are
included as a component of both the operating and capital budget processes.
Chugach accrues for costs associated with environmental remediation obligations
when such costs are probable and reasonably estimable.


                                       16
<PAGE>

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Chugach is exposed to a variety of risks, including changes in interest rates
and changes in commodity prices due to repricing mechanisms inherent in gas
supply contracts. In the normal course of our business, we manage our exposure
to these risks as described below. Chugach does not engage in trading market
risk-sensitive instruments for speculative purposes.

Interest Rate Risk

The following table provides information regarding auction dates and rates in
2006 on the 2002 Series B bonds. The maximum rate on the 2002 Series B bonds is
15%.

                   Auction Date                   Interest Rate
                   ------------                   -------------

                 January 25, 2006                     4.49%
                February 22, 2006                     4.55%
                  March 22, 2006                      4.69%
                  April 19, 2006                      4.80%

Chugach is exposed to market risk from changes in interest rates. A 100
basis-point change (up or down) would increase or decrease our interest expense
by approximately $876,200 based on $87,619,958 of variable rate debt outstanding
at March 31, 2006.

The following table provides information regarding cash flows for principal
payments on total debt by maturity date (dollars in thousands) as of March 31,
2006.

<TABLE>
<CAPTION>
                                                                                                                  Fair
Total Debt*             2006         2007        2008        2009        2010      Thereafter       Total         Value
-----------             ----         ----        ----        ----        ----      ----------       -----         -----
<S>                    <C>         <C>          <C>         <C>         <C>         <C>           <C>           <C>
Fixed rate debt        $1,500      $ 2,000      $2,000      $2,000      $1,500      $270,000      $279,000      $289,884

Average
interest rate            5.50%        5.50%       5.50%       5.50%       5.50%         6.39%         6.37%

Variable rate debt     $  588      $11,729      $7,241      $7,763      $8,297      $ 52,002      $ 87,620      $ 87,620

Average
interest rate            6.46%        5.68%       5.11%       5.11%       5.11%         5.93%         5.68%
</TABLE>

* Includes current portion

Commodity Price Risk

Chugach's gas contracts provide for adjustments to gas prices based on
fluctuations of certain commodity prices and indices. Because purchased power
costs are passed directly to our wholesale and retail customers through a fuel
surcharge mechanism, fluctuations in the


                                       17
<PAGE>

price paid for gas pursuant to long-term gas supply contracts does not normally
impact margins.

Item 4. Controls and Procedures

As of the end of the period covered by this report, we evaluated the
effectiveness of the design and operation of our disclosure controls and
procedures. Our chief executive officer (CEO) and chief financial officer (CFO)
supervised and participated in this evaluation. Based on this evaluation, our
CEO and CFO each concluded that our disclosure controls and procedures are
effective in timely alerting them to material information required to be
included in our periodic reports to the SEC. The design of any system of
controls is based in part upon various assumptions about the likelihood of
future events, and there can be no assurance that any of our plans, products,
services or procedures will succeed in achieving their intended goals under
future conditions. In addition, there have been no significant changes in our
internal controls or in other factors known to management that could
significantly affect our internal controls subsequent to our most recent
evaluation.

Chugach is in the process of implementing the requirements of Section 404 of the
Sarbanes-Oxley Act of 2002, which requires our management to assess the
effectiveness of our internal controls over financial reporting and include an
assertion in our annual report as to the effectiveness of our controls. In
addition, our independent registered public accounting firm, KPMG LLP, will be
required to attest to whether our assessment of the effectiveness of our
internal controls over financial reporting is fairly stated in all material
respects and separately report on whether it believes Chugach maintained, in all
material respects, effective internal controls over financial reporting as of
December 31, 2007. Chugach is in the process of performing the system and
process documentation, evaluation and testing required for management to make
this assessment and for KPMG LLP to provide its attestation report. This process
will continue to require significant amounts of management time and resources.
In the course of evaluation and testing, management may identify deficiencies
that will need to be addressed and remediated.

                            PART II OTHER INFORMATION

Item 1. Legal Proceedings

Matanuska Electric Association, Inc., v. Chugach Electric Association, Inc.,
Superior Court Case No. 3AN-99-8152 Civil

In this action filed in 1999, MEA alleged that Chugach breached the Power Sales
Agreement under which Chugach is obligated to sell MEA power for 25 years, from
1989 through 2014. MEA asserted that Chugach failed to provide it certain
information, failed to properly manage Chugach's long-term debt, and failed to
bring Chugach's base rate action to a Joint Committee before presenting it to
the Regulatory Commission of Alaska (RCA). All of MEA's claims were dismissed by
the Superior Court.

On April 29, 2002, MEA appealed to the Alaska Supreme Court the Superior Court's


                                       18
<PAGE>

dismissal of its claims related to Chugach's financial management and Chugach's
decision not to bring its base rate action to the Joint Committee before filing
with the RCA. Chugach cross-appealed the Superior Court's decision not to also
dismiss the financial management claim on jurisprudential and res judicata
grounds. The Alaska Supreme Court, on October 8, 2004, issued an order upholding
Chugach's right to not bring its base rate action to the Joint Committee before
filing with the RCA. But the Court rejected Chugach's cross-appeal and reversed
the Superior Court's decision dismissing MEA's financial management claim. The
Supreme Court remanded that claim to the Superior Court for further proceedings.

On January 24, 2005, Chugach filed for summary judgment on that claim asserting
that in the 2000 Test Year rate case the RCA had fully reviewed and decided the
prudency of Chugach's financial management. In a decision dated August 22, 2005,
the Superior Court granted Chugach's summary judgment motion, finding that the
RCA had adjudicated the question of Chugach's financial management and that its
decision should be given res judicata effect. The Superior Court also found that
the RCA had exercised its primary jurisdiction in reviewing Chugach's financial
management, and that its decision should be given deference.

The Superior Court entered final judgment on November 10, 2005, after which
Chugach sought its costs and fees. On December 14, 2005, the Superior Court
entered judgment awarding Chugach fees and costs from MEA in the amount of
$104,732, which has not, as yet, been recorded in the financial statements.

On December 9, 2005, MEA appealed to the Alaska Supreme Court the Superior
Court's grant of summary judgment. On December 23, 2005, Chugach cross-appealed
the Superior Court's failure to also grant summary judgment based on the
doctrine of collateral estoppel. This appeal is pending. Management is uncertain
of the outcome of the proceeding before the Supreme Court. No reserves have been
established for this matter.

Matanuska Electric Association, Inc. v. Chugach Electric Association, Inc.,
Superior Court Case No. 3AN-04-11776 Civil

On October 12, 2004, MEA filed suit in Superior Court alleging that Chugach had
violated its bylaws in allocating margins (capital credits) during the years
1998 through 2003. The margins Chugach earns each year are allocated to the
customers who contributed them and are booked as capital credits to those
customers' accounts. Capital credits are eventually repatriated to customers at
the discretion of the board of directors, typically many years after the margins
are earned.

On February 17, 2006, MEA filed a Motion to File an Amended Complaint and an
Amended Complaint in this case. The Amended Complaint is identical to MEA's
initial Complaint except for changes made to accommodate one new claim. The new
claim challenges Chugach's failure to provide MEA with a capital credit
allocation for 2004. We expect the Court will allow MEA's proposed amendment.


                                       19
<PAGE>

In this suit, MEA asks the Court to hold that Chugach breached its bylaws in the
manner in which it allocated capital credits in 1998 through 2003 and if the
Amended Complaint is allowed by the Court, through 2004. MEA also asks the court
to enjoin Chugach to re-calculate MEA's capital credits applying MEA's
interpretation of Chugach's bylaws and in accordance with what MEA refers to as
"generally accepted accounting practices for nonprofit cooperatives and
cooperative principles". The suit also seeks damages in an unspecified amount to
compensate MEA for the alleged breach of contract. This matter currently is
scheduled for a five-day trial beginning October 9, 2006. Management is
vigorously defending against the claim. The ultimate resolution of this matter
is not currently determinable.

Chugach has certain additional litigation matters and pending claims that arise
in the ordinary course of Chugach's business. In the opinion of management, no
individual matter or the matters in the aggregate is likely to have a material
adverse effect on Chugach's results of operations, financial condition or
liquidity.

Item 1A. Risk Factors

Chugach's consolidated financial results will be impacted by weather, the
economy of our service territory, fuel availability and prices, the future
direction customers may take and the decisions of regulatory agencies. Our
creditworthiness will be affected by national and international monetary trends,
general market conditions and the expectations of the investment community, all
of which are largely beyond our control. In addition, the following statements
highlight risk factors that may affect our consolidated financial condition and
results of operations. The statements below must be read together with factors
discussed elsewhere in this document and in our other filings with the SEC.

Fuel and Purchased Power Surcharge Mechanism

The fuel and purchased power surcharge mechanism allows Chugach to reflect
current fuel cost and to recover under-recoveries and refund over-recoveries
with a three-month lag. If Chugach were to materially under-recover fuel costs,
we may seek an increase in the surcharge to recover those costs at the time of
the next fuel surcharge filing. During periods of significant increases in
natural gas prices such as occurred in 2004 and 2005, Chugach realizes a lag in
the ability to reflect increases in fuel costs in its fuel and purchased power
surcharge mechanism. As a result, cash flow may be impacted due to the lag in
collection of fuel costs from customers. At March 31, 2006, Chugach had
over-recovered $763.6 thousand and at December 31, 2005, Chugach had
under-recovered $1.8 million. To the extent the regulated fuel recovery process
does not provide for the timely recovery of fuel costs, Chugach could experience
a material negative impact on its cash flows.

Equipment Failures and Other External Factors

The generation and transmission of electricity requires the use of expensive and
complex equipment. While we have a maintenance program in place, generating
plants are subject to unplanned outages because of equipment failure. We are
particularly vulnerable to this due to the advanced age of several of our
gas-fired generating units. In the event of unplanned


                                       20
<PAGE>

outages, we must acquire power from others at unpredictable costs in order to
supply our customers and comply with our contractual agreements. The fuel and
purchased power surcharge mechanism allows Chugach to reflect current purchased
power cost and to recover under-recoveries and refund over-recoveries with a
three-month lag. If Chugach were to materially under-recover purchased power
costs due to an unplanned outage, we may seek an increase in the surcharge to
recover those costs at the time of the next fuel surcharge filing. As a result,
cash flow may be impacted due to the lag in payments of purchased power costs
and collection of purchased power costs from customers. To the extent the
regulated purchased power recovery process does not provide for the timely
recovery of purchased power costs, Chugach could experience a material negative
impact on its cash flows. This factor, as well as weather, interest rates,
economic conditions, fuel supply and prices, are largely beyond our control, but
may have a material adverse effect on our consolidated earnings, cash flows and
financial position.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Not applicable

Item 3. Defaults Upon Senior Securities

Not applicable

Item 4. Submission of Matters to a Vote of Security Holders

Not applicable

Item 5. Other Information

Chugach's annual membership meeting was held on April 27, 2006. Out of 14,201
ballots, Jim Nordlund received 7,797 votes and was elected as a new Board of
Director. Jeff Lipscomb received 7,842 votes and was re-elected to the Board of
Directors. The following proposed amendment to the Bylaws passed:

Term limits: The term limit that restricted a director to serving three
consecutive three-year terms was reinstated.


                                       21
<PAGE>

Item 6. Exhibits

Exhibits:

      Certification of Principal Executive Officer pursuant to Section 302 of
      the Sarbanes-Oxley Act of 2002.

      Certification of Principal Financial Officer pursuant to Section 302 of
      the Sarbanes-Oxley Act of 2002.

      Certification of Principal Executive Officer pursuant to Section 906 of
      the Sarbanes-Oxley Act of 2002.

      Certification of Principal Financial Officer pursuant to Section 906 of
      the Sarbanes-Oxley Act of 2002.


                                       22
<PAGE>

                                   Signatures

Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                           CHUGACH ELECTRIC ASSOCIATION, INC.


                                           By:   /s/ William R. Stewart
                                                 ----------------------

                                                 William R. Stewart
                                                 Interim-Chief Executive Officer

                                           Date: May 10, 2006


                                           By:   /s/ Michael R. Cunningham
                                                 -------------------------

                                                 Michael R. Cunningham
                                                 Chief Financial Officer

                                           Date: May 10, 2005


                                       23
<PAGE>

                                    EXHIBITS

Listed below are the exhibits, which are filed as part of this Report:

    Exhibit Number                            Description
    --------------                            -----------

         31.1            Certification of Principal Executive Officer pursuant
                         to Section 302 of the Sarbanes-Oxley Act of 2002

         31.2            Certification of Principal Financial Officer pursuant
                         to Section 302 of the Sarbanes-Oxley Act of 2002

         32.1            Certification of Principal Executive Officer pursuant
                         to Section 906 of the Sarbanes-Oxley Act of 2002

         32.2            Certification of Principal Financial Officer pursuant
                         to Section 906 of the Sarbanes-Oxley Act of 2002


                                       24