MEA board OKs reduced third-quarter rate increase

WASILLA — Matanuska Electric Association customers will see a smaller-than-projected increase in base rates starting in July, part of what the utility is calling a trend bolstered by outside power sales and power plant efficiencies.

According to a press release from MEA, the utility’s board of directors May 9 voted to approve a 0.83 percent increase in base rates for the third quarter of the year, which begins in July. The rate came in lower than the co-op’s budgeted 2.6 percent hike.

According to MEA, a typical member that uses around 700 kilowatt-hours of electricity per month can expect to see a total monthly increase of about $0.71 as a result of the third-quarter base rate adjustment. The adjusted rate has to receive Regulatory Commission of Alaska approval.

According to the press release, total year-to-date base rate increases for 2016 are approximately 40 percent lower than anticipated for the “cost of power adjustment ”component of ratepayers’ bills.

The reductions come in part from recent “loose pool” energy sales with other Railbelt utilities and better efficiencies with the 171-megawatt Eklutna Generation Station, according to the co-op.

MEA spokeswoman Julie Estey said Monday that plant managers have reported virtually no downtime with the engines at the Eklutna plant.

“As people might expect with a new plant, things need to get broken in,” Estey said, “but the managers have been pleased with the lack of downtime, which has led to that efficiency.”

Estey added that the engines also are burning fuel more efficiently.

Power deals with other Railbelt utilities like Golden Valley Electric in Fairbanks as well as Chugach Electric and Municipal Light and Power in Anchorage have helped in the rate reduction, Estey said. The voluntary loose power pool market accounted for 10 percent of MEA’s total plant output in 2015, according to the co-op.

“We are pleased with this trend of rate savings for our members,” MEA General Manager Tony Izzo said in the release. “The savings are small now, but we will continue to find ways to do more with less and collaborate with our Railbelt colleagues to capture even more benefits for our members.”

Under the terms of rules set by the RCA, utilities are allowed to file for limited increases or decreases in base rates, provided that the adjustments stay within certain financial parameters established by the regulatory agency.

Contact reporter Steven Merritt at 352-2269 or steven.merritt@frontiersman.com