Homer Electric Association members will see a not-so-pleasant surprise in their January electric bills. The average HEA member can expect a rate increase of more than $10 a month. The rate increase is one of the largest HEA members have seen in a long time.
The rate hike stems from a quarterly change in HEA’s Cost of Power Adjustment, or COPA. HEA spokesperson Joe Gallagher says the COPA is going up this quarter by just over 1.7 cents per kilowatt hour. And while that might not seem like a lot, it equates to more than a $10-per-month increase for an average HEA member using 630 kilowatt hours a month.
"That is something that is of great concern to Homer Electric," said Gallagher. "But it is a pass-through cost ... and because it's tied into natural gas prices, we're tied into it."
In a news release, HEA General Manager Brad Janorschke said he recognized the impact on HEA members would be “significant.” He promised that the co-op would work to develop more efficient means of power generation in the future, including the use of alternative energy sources.
On the same day that the new rates go into effect, HEA will also be officially declaring energy independence from Chugach Electric Association, from which it has purchased electrical power for many years. HEA’s “Independent Light” program has been in development for the last couple of years and is set to provide 100-percent of the Kenai Peninsula’s power, beginning January 1st.
Gallagher says that unfortunately, that does not mean the co-op will be any less dependent on the fluctuating price of natural gas.
The rate increase is not yet official. HEA has submitted a request to the Regulatory Commission of Alaska, which governs utilities statewide and must approve all rate adjustments. Gallagher says that typically, rate increases that are tied to the cost of natural gas are approved by the RCA.