Chugach Electric to make refunds and implement new rate structure
On Nov. 7, the Regulatory Commission of Alaska issued a ruling in response to Chugach Electric Association's Sept. 8 filing to comply with establishing its new rate structure. The approved rates will be implemented in November, with rate decreases for Chugach's wholesale and small commercial customers, and rate increases for Chugach's residential, large commercial and lighting customers.
Although Chugach will continue to pursue fairness for retail customers in an appeal to the Alaska State Superior Court, Chugach will be making refunds to its wholesale and small commercial retail customers. A recent order from the court directed Chugach to complete the refund process within 10 days. Chugach has petitioned the court asking for additional time for completing the retail customer refunds.
Chugach expects to issue refunds to its wholesale customers Nov. 10. Refunds that are due to the small commercial customers having active accounts and receiving service from Chugach since Jan. 31, 2003, will receive credits on their accounts. The process will be implemented over a one-month billing cycle. Customers who do not have an active account will be mailed a check.
The current wholesale refund is anticipated to be approximately $4.8 million, with Matanuska Electric Association receiving about $2.9 million, Homer Electric Association receiving close to $1.8 million and Seward Electric System getting more than $100,000. In total, the small commercial customers will be refunded about $500,000.
Changes to base retail rates include increases of 0.6 percent for large commercial customers and 1.4 percent for residential customers. They also include decreases of approximately 8.9 percent for small commercial customers and 11.3 percent for wholesale customers (Matanuska Electric Association, Homer Electric Association and Seward Electric System).
On Oct. 31, the court granted Chugach's Oct. 3 request to dissolve a stay regarding an appeal on the 2000 Test Year rate case. However, Chugach will continue to pursue fairness for retail customers in its appeal in Superior Court.
The refunds and rate changes are the result of orders from the RCA issued earlier this year. Chugach believes that the rate orders are unfair to its retail customers and put a disproportionate burden of the costs of margin earnings on retail customers. Chugach's desire to protect its customers and maintain the true nature of a cooperative has resulted in an appeal that has been filed in State Superior Court.
Chugach is the largest electric utility in Alaska, providing power for Alaskans throughout the Railbelt through retail, wholesale and economy energy sales.