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Chugach Electric has proposed rate increases for its customers
Alan Bailey for Petroleum News
Anchorage based Chugach Electric Association has asked the Regulatory Commission of Alaska for approval of an increase in the rates that the utility charges its customers. The electricity utility told the RCA that "to manage Chugach's operations and fulfill its mission of providing safe, reliable and electric services to its members, Chugach must ensure its revenue is sufficient to cover expenses and meet operational needs." The utility says that the increases are required as a consequence of a revised revenue requirement derived from a decline in electricity sales and an increase in the utility's costs.
Chugach Electric says that its sales declined by more than 3% through June 2025, primarily as a consequence of unusually warm winter weather.
Julie Hasquet, Chugach Electric senior manager, corporate communications, has told Petroleum News that over the past months the utility has seen an increase in the cost of its debt, the cost of bringing its new battery energy storage system into operation, and the cost of upgrading its distribution system for improved supply reliability. Those cost increases have arisen in a situation where Anchorage has seen cost inflation of about 18% over the past five years, Hasquet added.
High weather impact In testimony to the RCA the utility said that the impact of the warm weather exceeded the level within which the utility could adjust its rates on a quarterly or semi-annual basis. Hence the need to seek approval for rate increases through a tariff filing.
In its tariff filing the utility says that the proposed changes would result in an increase of 3.84% for the total bill for a residential electricity consumer, while commercial customers would see increases ranging from 1.44% to 4.00%, depending on the class of customer. Chugach Electric also proposes a new economic development rate with a discount that drops on a year-by-year basis, to encourage commercial customers to locate or expand their operations within the utility's service area.
The utility also wants to increase the tariffs that it charges for use of its components of the Alaska Railbelt transmission system.
The utility has also proposed interim rates that would come into operation on a temporary basis if the RCA decides to open a docket to investigate the new tariff.
--ALAN BAILEY
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