GVEA Hikes Rate Due to Loss of Hydropower Line and Healy 2 Coal-generated Electricity
Golden Valley Electric Association customers will be paying more for electricity over the next few months, due to the temporary loss of two sources of cheap power. The utility’s chief executive says problems with the Healy 2 power plant and a hydropower plant transmission line near Homer will boost the average residential ratepayer’s monthly bill we by about $11 through February.
Golden Valley president and CEO Cory Borgeson says the utility increased its Fuel and Purchased Power rate this month by nearly 20 percent to pay for the cost of generating more electricity with expensive liquid fuels like diesel after temporarily losing two of its cheapest sources of energy, from the Bradley Lake Hydropower facility and the Healy 2 coal-fired plant.
“During the next three months, starting December 1 – so December, January and February – (expect) to see a fairly significant increase in our cost of power to our members.”
Borgeson says the average residential customer who uses about 600 kilowatts of electricity monthly will see an additional $11 on their light bill. He says the utility’s leadership regrets that the rate hike will kick in during the coldest months of winter.
“Those are months in which our members use a lot of kilowatt hours, so it kind of has a double-whammy effect on our members,” he said in an interview Friday.
Borgeson says Golden Valley and utilities in Southcentral haven’t been getting hydropower from Bradley Lake since mid-August, after the Swan Lake Fire damaged the big transmission line that brings electricity up from the hydro facility on the Kenai Peninsula. He says that in turn has limited the availability of cheaper, natural gas-generated electricity that Golden Valley usually buys from Chugach Electric in Anchorage and Matanuska Electric Association, in the Mat-Su.
“And as the Anchorage utilities use their own generation for their own use as an alternate to the Bradley power,” he said, “then they’ve been unable to sell us as much power as we’ve been using in the past.”
Electricity from the hydropower facility costs an average of 4 cents per kilowatt hour. That’s much cheaper than generating electricity with diesel or naphtha. Borgeson says Homer Electric Association officials hope to have the transmission line repaired and back in service by the end of the month.
Meanwhile, Golden Valley’s also has had to temporarily do without the biggest generator of it other cheap source of power over the past few months, the coal-fired Healy 2 power plant, because of problems with the system that removes the ash byproduct.
“As a result, the plant didn’t produce for those 12 days, which caused us to have a higher rate of power than we had anticipated,” Borgeson said.
Electricity generated by Healy 2 costs just over 7½ cents per kilowatt hour. Borgeson says workers found other problems at the plant while working on coal-ash system. But on Sunday, he said those have been fixed and that Healy 2 is back online. And he said work begins today on the Bradley Lake power line repairs.