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City Of Bethel Joins Lawsuit Against Governor Over PCE Funding Cuts

AVEC CEO Meera Kohler said power went out in Bethel, Napaskiak, and Oscarville the night of Jan 28., with outages ranging between 20 minutes and two hours.
Krysti Shallenberger

The City of Bethel has joined a lawsuit against Gov. Mike Dunleavy and his administration over funding cuts to the PCE program.

PCE, or power cost equalization, lowers the cost of electricity in rural Alaska to make it comparable to more urban areas like Anchorage, Fairbanks, and Juneau. The program was created in 1985, the same time that the state invested millions of dollars into major energy projects like dams and power lines that reduced the cost of electricity in urban areas of Alaska.

In 2019, Gov. Dunleavy, for the first time in the program’s history, allowed funds earmarked for the PCE program to be “swept” into the Constitutional Budget Reserve where they could be used for other parts of the state budget.

Legislators can put that money back in the PCE Endowment fund with a three-quarters majority vote, but they didn’t get the required number of votes this year. That essentially cut funding for the PCE program.

The City of Bethel has said that it stands to lose over $80,000 a year with PCE funding cuts. Alaska Village Electric Cooperative (AVEC) CEO and President Bill Stamm said that customers could expect their energy bills to double without PCE credits.

AVEC, the Association of Village Council Presidents, the Alaska Federation of Natives, 15 other organizations from around the state, and now the City of Bethel are suing the governor. The lawsuit says that the governor violated the law by sweeping funds appropriated for the PCE program into the Constitutional Budget Reserve.

If the lawsuit fails, legislators could still fund PCE with a three quarters majority vote in their next legislative special session, which is scheduled to begin Aug. 2. At its last meeting, the Bethel City Council passed a resolution supporting full funding of the Power Cost Equalization program.


Greg Kim is a news reporter for KYUK covering environment, health, education, public safety, culture and subsistence. He's covered everything from Newtok's relocation due to climate change-fueled erosion to the Bethel chicken massacre of 2020.