After power rates in Aniak shot up to some of the highest in the world, customers asked the Regulatory Commission of Alaska to reconsider the way those rates were calculated. The commission decided to make some changes, requiring Aniak Light and Power Company to file price changes more often.
In the latest filing, the Regulatory Commission of Alaska approved new rates for the price of power in Aniak that take effect on Sept. 29. The good news is that power prices will go down again in Aniak to $160.84 for 500 kWh due to fuel prices decreasing, a decrease in projected sales, and a smaller company deficit. However, the commission has also lifted the requirement for more frequent rate adjustments and made two new decisions.
First, staff recommended that the commissioners add a requirement that would give them more oversight over Aniak Light and Power Company’s fuel expenses. This came after another unusual expense of over $26,000 on the books this May to account for 4,900 gallons of fuel that the power company said was used for things other than power generation.
The original spike in prices this summer was also mainly due to a large expense for unaccounted for fuel that had to be added to customers’ bills.
When the commission inquired about the expense on the books for May, the power company’s CEO, Darlene Holmberg, said that the expense was the annual fuel reconciliation. The company said that they measured the amount of fuel in their tanks to expense the amount of fuel used for heat, vehicles, and anything else other than generating electricity.
Holmberg said that Aniak Light and Power Company had done this the previous summer too, but there’s no expense on the books. She said that before last year it had been overlooked since 2008.
The commission staff recommended that the commissioners require the company to report the fuel level in the tanks when they’re accounting for their fuel inventory.
The second nonstandard part of the filing was the commission’s decision to waive the “line loss” standard for the company, which allows for a maximum of 12% of power lost during generation. Aniak Light and Power Company has exceeded that since January. Because they didn’t meet the standard, that would normally have reduced the amount of state subsidy under the Power Cost Equalization program, which cuts power costs for rural households.
But Aniak Light and Power Company requested that be waived, saying that they didn’t know why their line loss was high, but that they would try and pinpoint the cause. The commission decided that it would let the community keep the maximum subsidy.
Organizations in Aniak are working together to find a more long-term solution to keep electricity prices reasonable.
At the statewide Alaska Federation of Natives Convention in October, the Association of Village Council Presidents will sponsor a resolution made by the Aniak Native Council that calls on the state of Alaska to investigate and change the composition of the Regulatory Commission of Alaska because of its decision to approve the exorbitant electricity rates in Aniak without prior notice.
