Electric customers in Wrangell will see their electricity bills rise from February, after the local government approved the community’s first increase in electricity rates in nearly a decade.
Electricity bills in Wrangell will be 6-7% higher next month. At a meeting on Tuesday, January 11, the Wrangell assembly approved a rate increase of one cent per kilowatt hour for all electric customers. Electricity rates for residential customers are calculated with a base price of $8 and additional tiered rates based on the amount of electricity used.
Part of the rate increase is in response to an increase in the wholesale electricity price. Wrangell, Ketchikan, and Petersburg all purchase hydroelectricity from the Southeast Alaska Power Agency (SEAPA). Last month, the SEAPA board voted to raise the wholesale cost of electricity by a quarter penny per kilowatt-hour (kWh), citing significant infrastructure costs over the year last. This is SEAPA’s first wholesale rate increase in more than two decades.
The Wrangell local government originally considered matching SEAPA’s fare increase. But last month he gave initial approval for a three-quarters of a cent increase on top of the wholesale increase. The assembly justified the hike by saying it would help pay to maintain and repair Wrangell’s aging infrastructure.
Mayor Steve Prysunka also sits on the SEAPA Board of Directors. He told Wrangell Assembly on Tuesday, Jan. 11, that there may be more wholesale rate increases to come. But he said that’s not exactly why Wrangell is raising its rates.
“I think it would be dishonest to just say, ‘We’re increasing ours now in anticipation of them increasing theirs,’ because we’re going to have a year of increased revenue from the increased increase,” Prysunka said, making reference to discussions at the December meeting on the need to replenish the Wrangell Electric Company Fund.
Assemblyman Patty Gilbert supported the rate increase, but said SEAPA should coordinate more closely with the places it serves.
“I would appreciate if they let communities know ahead of time,” she said. “I know there have been rumors of an increase, but it will go into effect for the public next month, and we only had a month’s notice.”
She also expressed her frustration with the time of year.
“The dead of winter, in my opinion, is not the right time to raise electricity rates,” Gilbert said.
Prysunka said that even as a board member of SEAPA, he was surprised at how quickly the rate increase was achieved.
“A raise was proposed in December last year, and the council closed it because we didn’t have enough time to adequately prepare the communities,” Prysunka explained. “So I think you’ll recall that I came back many times saying, ‘A rate hike is coming. I don’t know how much but a rate increase is coming. And I kind of said that in the meetings. But I guess I incorrectly assumed there would be something official from SEAPA saying “Hello on such and such a date the board is going to meet and vote to raise it that much you should anticipating this increase.”
Wrangell will begin paying SEAPA’s wholesale electricity rate increase on January 20.
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