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Retroactive rate payments explained

Posted: Friday, April 25, 2008

If Alaska Electric Light & Power Co.'s nearly five-fold rate adjustment goes into effect for May 1, then the rate changes will apply to all of the previous month's electricity usage.

It means ratepayers who receive their electric bill on May 1 may be getting the shortest end of the proverbial stick.

That's because all the electricity they used the first 15 days in April - before they could respond to the loss of the electric company's hydroelectric transmission line to avalanches by lowering their consumption, will be charged at the higher rate.

Any ratepayers whose bill comes before May 16 will also have to pay for their April electrical usage prior to the avalanches at post-avalanches rates, if the rate hike goes into effect.

AEL&P's director of consumer affairs, Gayle Wood, said the retroactive rate structure is part of the company's agreement with the Regulatory Commission of Alaska, the state's regulatory body. She pointed out that those hit hardest now will also be the first to benefit when electric rates go down in the future.

AEL&P estimates it will take three months to repair the transmission line, and that its rates for June and July may be lower than May's rates.

Wood said the company understood some of its customers were concerned about the situation and added that her office had been busy trying dispel rumors about the retroactive rates, such as they also would apply to March electric bills.

Wood said AEL&P is considering options for those customers whose bills are sent in the first half of the month, and she hoped to make details of those ideas public in the next few days.



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