MEA Approves Fourth Quarter 2014 Rate Increase and Considers Future Projections
PALMER, Alaska -- The Matanuska Electric Board of Directors voted on August 11, 2014 to authorize an increase of 2.19 percent in base rates effective fourth quarter of 2014. The average MEA member using just over 700 kilowatt-hours of electricity per month can expect to see a total monthly increase of about $1.70 as a result of the base rate adjustment.
Under the regulations of the Regulatory Commission of Alaska (RCA), MEA is allowed, on a quarterly basis, to file for increases or decreases in base rates, provided the adjustments stay within certain parameters established by the RCA. This rate increase is based on the test year ending June 30, 2014 and will take effect during the first week of October 2014 pending approval by the RCA.
MEA has also updated its longer-term financial projections. The projections are complicated this year by MEA’s transition from a wholesale purchaser of power to producing its own power at the new Eklutna Generation Station (EGS), currently under construction and set to go online in early 2015.
Similar to the other Railbelt utilities that are projecting near-term rate increases, MEA members should also expect an increase in rates through 2015 driven by the cost of fuels used to produce the power at EGS, primarily the increased cost of natural gas. Current projections indicate an overall increase in retail rates of approximately 15 - 20% over the next 18 months.
“It is important to MEA that we are transparent with our members and give them the opportunity to take steps to reduce their electric bill and plan their budgets,” said Joe Griffith, General Manager of Matanuska Electric Association. “We strive every day to deliver reliable service and keep rates as low as possible, and we hope our members will use the resources available on our website and others to manage their bills through efficiency measures as well.”
The primary driver is increased costs of gas and other fuels. A smaller portion of the projected increase is a result of infrastructure projects like the construction costs of the new EGS power plant and transmission line and other system upgrades that are long overdue to ensure electrical reliability in the system.
MEA remains committed to providing our members with reliable, economical energy.
Matanuska Electric Association, Inc., Alaska's oldest and second-largest electric cooperative, is owned and operated by its members. MEA’s service area includes more than 4,200 miles of power lines and serves 60,000 accounts in Southcentral Alaska.