Regulatory Commission of Alaska

Public Comment for TA886-2 by James Mackovjak

As an Alaska Power Company customer in Gustavus, Alaska, I am commenting
on the petition by APC to raise rates across-the-board to an interim rate (up 10% from current)
and permanent rate (up 13.3% from current) for all APC customers. For Gustavus, this means
going from $0.3564/kWh and a $20/month customer charge to an interim rate of $0.3920/kWH
and $22/month customer charge.

Our community has suffered from disproportionately high effective electric rates since the hydroelectric service came online. Therefore, I request that the current rate be maintained particularly in light of near-term plans to connect Glacier Bay National Park’s headquarters to the Gustavus electrical system.

Despite being accessible to barge fuel deliveries, having hydroelectric availability most of the
year from a system that was funded primarily through grants/appropriations, and serving a year-round, Gustavus is:
• Ranked first in effective electrical rates of all APC communities. Excluding
RCC, our current effective rate (TA884-2) is $0.3000/kWh. Other communities range
from $0.1657 (Tok) to $0.2832 (Allakaket).
• Ranked first for effective rate in the APC system for hydroelectric. According
to the 2019 Alaska Energy Authority Power Cost Equalization Statistical Report, the only
communities with hydroelectric power in Alaska with higher effective rates are Larson
Bay and Atka, which are geographically isolated on the west shore of Kodiak and in the
Aleutian Islands.
• Ranked 34th highest effective rate across Alaska in the 2019 Alaska Energy
Authority Power Cost Equalization Statistical Report
• Ranked highest effective electrical rate in Southeast Alaska (2019 Alaska
Energy Authority Power Cost Equalization Statistical Report)

Why do we pay so much for electricity? Two nearby communities, Hoonah, served by Inside
Passage Co-op, and Yakutat, served by Alaska Village Co-op, have effective rates of $0.2633 and
0.1810/kWH. Does Gustavus warrant paying 14-66% more than our neighbors? Our electrical
costs are a deterrent for moving here and starting/operating a business, particularly as
businesses do not benefit from PCE. When comparing the ratio of Electric Rate to Total Cost, we are the only APC community that has a higher rate than cost. Gustavus’s PCE is
also routinely penalized for line loss exceeding 12%. When the penalty is passed to consumers,
where is the incentive of the utility to remedy the issue? This line loss is nothing new. I assume APC did due diligence, and remedying this situation was a consideration in the price APC paid for Gustavus Electric Company.

I therefore request that APC grant Gustavus a waiver to be excluded from the interim and
permanent increase because we are already paying our fair share of the local utility costs. If other communities paid as much as Gustavus customers, APC would have no need to
institute across-the-board service increases as we are 7.3% of APC’s customers.

The Covid-19 public health emergency is also an economic emergency, and the Gustavus
economy, which is considerably reliant on the summer visitor season, has deeply suffered. The
current pandemic shutdowns, compounded with high unemployment, and little indication that
jobs or the tourist season will return to pre-pandemic levels in 2021, sets Gustavus on a path to
another year of severe economic downturn. Glacier Bay National Park is also negatively
affected by the lack of cruise ships and tour boats, resulting in smaller work forces, loss of
wages, and employee hardships. Note that the Centers for Disease Control and Prevention in
early September issued a ban on evictions under certain circumstances. Insensitive to this
hardship, APC wants to raise our rates. APC has noted that it intend to defer collection of the
increased rates until March 1, 2021. Deferring collection is an inadequate and
insensitive response.

Finally, the federally-funded intertie between Gustavus and Bartlett Cove is, to the best of my
knowledge, scheduled to be constructed in the spring of 2021 (by APC). A rate case before the RCA will be required to adjust electrical rates to reflect this major expansion of APC’s customer base. For Gustavus, it makes no sense for another rate case, as described in the filing, to
happen before the Intertie is complete.

Thank you for considering my comments. Please send a response via email to me at lituya@gmail.com.

A copy of these comments will be filed with APC at its address: Steven J. Kramer, Senior
Director – Regulatory Affairs for APC, at 901 N. Leatherleaf Loop, Suite 201, Wasilla, AK 99654;
phone: (907) 864-3211; email: Steve.k@aptalaska.com.

Type

Comments

Date Filed

10/21/2020

Tracking Number

TR2005832

Filed By

James Mackovjak

Entities

Certificate(s)

Means Received

Internet

Related Matters

TA886-2	Alaska Power Company - Revenue Requirement Study

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