Power spike in Gustavus causes costly damage

Residents say thousands of dollars in equipment must be repaired, replaced

Posted: Tuesday, October 21, 2003

A power spike at the Gustavus Electric Company last week caused thousands of dollars in damage to electrical equipment for some residents of the small town near Glacier Bay National Park, prompting some to complain about the company's service and prices.

Dick Levitt, the company's owner, said the spike is the first of its kind during his 20 years of ownership.

"There was a failure of a voltage regulator on a generator and that allowed for a voltage spike," he said. "It probably got up to 160 volts on a 120-volt circuit for we estimate four minutes before it kicked off-line."

During that four minutes on Wednesday night, about one-third of the town sustained damage to computers, televisions, satellite receivers and other electric equipment, Levitt said.

"I sustained about $5,000 worth of damage in my store and home," said Tim Gibson, who owns Gusto Building Supply.

Other residents sustained anywhere from hundreds to thousands of dollars worth of damage, he said.

At least two complaints about the spike were made by Gustavus residents to the Regulatory Commission of Alaska as of Monday afternoon, said Agnes Pitts, a spokesperson for the state agency that oversees Alaska's utility providers. She said residents who sustained property damage during the power spike and want to file a claim should do so with the company as soon as possible.

Once a claim is filed, the company will submit them to its insurance provider. Customers have the option of appealing to the RCA if a claim is denied, Pitts said. The agency will investigate the incident and determine if the power company was negligent.

"We don't award claims for damage - that is a civil matter, a court matter," Pitts said. "But if we investigated and found out that the utility was negligent in some way, (customers) could take it to a court law and use that to support their case."

The problem could have been prevented with an overvoltage protector, but the equipment wasn't in place because "this problem is extremely rare," Levitt said. He plans to purchase and install an overvoltage protector soon, but does not know if customers will be compensated for their losses.

"I haven't told anybody they're out of luck, but I haven't really said what I'm doing yet because I don't know," he said. "Right now my main focus is to cure the problem so it doesn't happen again."

The power spike contributed to some Gustavus residents' discontent with the utility company.

"Do you know what it's like to pay 50 cents per kilowatt hour?" said T.J. Farrell, a Gustavus resident who also sustained damage in the spike. He and other Gustavus residents have asked the RCA to investigate what they claim are abnormally high costs of electricity.

"Our rates are extremely high - almost 20 cents higher than Hoonah or Tenekee," said Greg Streveler, chairman of the Gustavus Community Association. The community association filed an official appeal to the RCA this spring.

The review will allow residents of the town, which has petitioned the state to become a second-class city, to determine ways to lower electricity costs. If Gustavus becomes a city, the city may buy the power supply company and look for government subsidies to defray the costs.

"They say the reason is the historical one, that the community is very far-flung and that the start-up costs were very high, so amortizing those costs is a big part of the cost," Streveler said. "I suspect that's true, but we need a disinterested third party to tell us that."

The RCA has not yet completed its analysis of the cost of electricity in Gustavus, Pitts said. The agency plans to combine the investigation with a standard filing from the electric company to authorize the increase or decrease of rates based on fuel costs.



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