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Power bills on the rise as electricity surplus dries up

Lake levels low after dry August; company mulls burning diesel

Posted: Tuesday, November 20, 2007

Electricity customers can expect to see their bills rise this month as a dry August left lake levels low and the power company expects to have to burn diesel to make up the difference.

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The average bill this month will climb by $18.25 because Alaska Electric Light & Power Co. is not selling any surplus power, which usually generates a credit to regular customers, according to the power company. High diesel costs also will contribute to the rise.

AEL&P is predicting there's a 50 percent chance it will have to burn diesel to generate up to 15 million kilowatt hours of electricity this winter. That's enough electricity to power 15,000 homes for a month, AEL&P's director of consumer affairs Gayle Wood said.

Besides lower lake levels, increased demand is also a culprit, Wood said. Demand rose about 5 percent last year, compared to growth of 1 percent to 2 percent per year until 2006.

The power company says that's a result of two new box stores in town, and an increase in residential customers switching to electric heat.

The power company usually sells surplus to certain customers, such as Greens Creek mine on Admiralty Island, some schools, cruise ships and residential customers.

"In August we turned out with the seventh driest August on record. There was a dramatic shift in how fast our lakes were filling," Wood said. "At that point we declared we did not have surplus to serve Greens Creek mine."

A review of water flows into the lakes in October resulted in a "dramatic" change in their models, Wood said, and resulted in predictions for having to burn diesel soon.

She urged customers to conserve on all energy use and use diesel heat if they have it available.

"It's not the right time to be thinking about going from a diesel-fired heating system to an electric-fired heating system," Wood said. "A diesel system is much more efficient at making diesel into heat right at the house than us generating electricity out of diesel."



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