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Latest FAQ additions What has been learned about the avalanches that took out the section of line and the potential for similar problems in the future? Avalanche specialist Bill Glude determined that the destructive force and mass of this set of avalanches were at the highest end of the scale used to quantify avalanches. Because of the magnitude of this set of avalanches, typical diversion structures would not have prevented this line failure. Bill Glude pointed out that a 100-year event is an average period of time between such enormous avalanches, but that such an avalanche could happen again at any time. Why didn't AEL&P take precautions to prevent this? The Snettisham project and line has been energized for 35 years without a significant outage since the mid-70s. The Army Corp of Engineers originally built this project for the federal government. It is obvious that they studied the area and planned the tower locations to avoid most avalanche activity. When the State of Alaska (Alaska Industrial Development and Export Authority - AIDEA) purchased the project in 1998, they did a thorough due diligence study and risk assessment. Nothing in their assessment suggested a need for additional mitigation. While the area has avalanches annually, nothing as damaging as this has ever occurred. Monitoring the snowpack could be done, but it presents dilemmas. Simply knowing that the snow pack is unstable may not be enough for AEL&P to risk causing damage by attempting to shoot excess snow off the upper reaches of this mountain. Purposely attempting to cause small avalanches doesn't always result in small, controlled avalanches. There are counter arguments against disturbing a snowpack that may ultimately melt without significant incident. AEL&P has seen the results of avalanche control for Thane Road. AEL&P's system has been severed by this activity at least a couple of times in recent memory. Avalanche control is partly art and partly science, and comes with significant monitoring costs and the potential risk of causing more damage. Why wasn't the transmission line insured? How will the repair costs be paid? Industry-wide, transmission lines are typically not insured. If insurance could be purchased, the cost could be about as expensive on an annual basis as the costs for the repairs that have just been completed. Every five years, the operations contract with AIDEA requires an insurance review, and 2008 is a review year. The consultant hired to do the review will check on the availability and cost of insurance for the line. The repair costs will likely be financed through a long-term loan, though grant funding is being sought. The impact to rates will be negligible and will not occur until after new rates are approved by the Regulatory Commission of Alaska, possibly in 2009 or 2010. Why were the towers placed on the same foundations? A team of about 20 engineers, contractors and others familiar with the area spent two days brainstorming and assessing various options for rebuilding the line as quickly as possible, and with the least amount of expense. Eight options were studied, including submarine and above-ground cable, and the final decision was to go with the existing locations because the engineering design was already complete, and because the repairs could be completed in the least amount of time. Time was of the essence given the very high cost of diesel generation. Some options were identified for further study to help mitigate the situation in the future, but would take too much time to engineer, secure materials, and construct. What will AEL&P do now that the repairs are finished? AEL&P will be reviewing its response to this disaster to learn from the experience. We will also be looking at options to mitigate avalanche damage in this section of the line, given the current high diesel prices and the resulting costs to our customers of long-term standby generation. We will soon initiate a process to select an engineering consulting firm to analyze various options.
Previous FAQs
We recognize the tremendous
impact this emergency will have on all the families and businesses in AEL&P is currently sending a letter to all customers that provides information on payment options, information on what their levelized payment would be if they choose this option, and how they will be able to sign up for the different options. 2. We’ve heard that rate increases will be retroactive, perhaps even back before the avalanche. How will you even things out?The original proposal approved by the Regulatory Commission of Alaska (RCA) would have resulted in energy used between April 1 and April 15, before the avalanche, to be billed at the higher rate. In response to a great deal of feedback from our customers we developed a different proposal. Our new proposal, to begin the emergency rate on April 16, the day of the avalanche, was approved by the RCA on May 7. As a result, bills under the emergency rate began on May 16 and will end on June 14.
3.
Will the
cost of repairs be included in the increase in electrical rates, or can
we expect to pay for those costs over a longer period? The repairs will be financed with a loan over a longer period of time. This will reduce the rate impact for the repairs to just a fraction of a cent per kWh. 4. Does AEL&P intend any modifications to its regular rules for shutting off electrical power for non-payment of charges to homes and/or businesses? What are those modifications?As a utility
regulated by the State of
5.
Who regulates utility rates? Did AEL&P make any
application regarding emergency rate increases?
When will those be made? Yes. AEL&P is regulated by the Regulatory commission of Alaska (RCA). We filed an initial Emergency Cost of Power Adjustment with the RCA on April 22. A second filing, to extend the effective date of the Emergency COPA to May 16 was approved by the RCA on May 7. On June 10, additional rate changes were filed to cover mid-June through mid-July and diesel use from last winter.
6.
Will AEL&P profit from this emergency? No. The RCA will allow only the actual cost of fuel to be included in the emergency rate. No markup or profit is allowed. Other cost increases due to the emergency such as employee overtime and additional maintenance on the diesel generators will come from AEL&P’s normal revenues. This will be a difficult time financially for AEL&P as it will be for all businesses in town.
7.
I’ve heard
AEL&P employees get a break on electric rates as an employee benefit. Is
that true? No. All AEL&P employees pay the same rate you do. 8. Will AEL&P continue to provide power for industrial consumers such as Greens Creek Mine and Princess Cruise Line?No. There will be no power sales to cruise ships or the Greens Creek Mine while we are on diesel generators.
1.
What
happened exactly?
Was it really an avalanche a mile and a half
long?
The morning
of April 16, at least three separate avalanches came down destroying
three transmission structures and damaging two others.
The damage occurred over a one and a half
mile stretch of the Snettisham transmission line. When the State of Hydropower was restored to Juneau on June 1. We were committed to restoring power from Snettisham as quickly as possible. Shortly after the avalanche we signed a contract with a transmission line construction company with the goal of having the job done by the end of July. The contractor was hopeful that it could be completed even sooner. Two factors were largely responsible for the early restoration. Excellent weather allowed contractors almost daily access to the site. Also, all tower foundations were found intact. Rebuilding these platforms would have significantly added to the repair timetable. 4. What precautions will be taken to avoid a repetition of this incident?We examined the alternatives for restoring Snettisham power and determined that the quickest and most economical option for restoring power was to replace the towers on the existing foundations. We are now evaluating long-term alternatives for securing the line, such as avalanche control, avalanche diversion structures, underground line, and even a submarine cable around the area. These alternatives will be carefully studied, weighing the cost and benefits of each. We will be completing a study of what can be done to economically mitigate the avalanche hazard in this particular area. The Snettisham transmission line is 43-miles long and is susceptible to many natural processes, including high winds, falling trees, landslides and avalanches. The line was well designed to minimize the exposure to these types of hazards. Our normal maintenance program also helps to minimize possible damage, but the fact is that it will never be possible to completely eliminate the possibility of damage to the transmission line. 5. At least one proposal has been made to provide alternate fuel (natural gas) to operate AEL&P’s generators. Has the company given these proposals consideration and what are its conclusions?We are aware of the natural
gas proposal
KEEPING IN TOUCH
7.
How will
AEL&P communicate updates and changes directly to the public?
How do you plan to field consumer questions
directly? AEL&P will continue to update
the public about the situation through the media, posting updates on our
website and in direct mail to you, the customer.
Please email us or call
us at 780-2222 with any further questions you have and we will continue to update
and post responses to the top questions on this site.
Our number one job is keeping the power on in
What is
this Emergency Power Cost Adjustment (also known as Emergency Cost of
Power Adjustment or ECOPA)? Electric customers pay rates that
cover the cost of providing their service.
AEL&P’s normal rate structures are based on
the cost of using water to turn the turbines to make electricity.
Now that diesel is needed to turn the
turbines, the cost of providing electric service goes from the base
price of rain water as fuel (zero fuel cost), to the cost of diesel,
which is currently about $4.00/gallon.
Every utility has a Power Cost Adjustment to
adjust rates according to changes in the fuel cost over/under the base
rate cost of fuel.
How is the ECOPA calculated?
Will it be lower in June? The ECOPA for May is based on the
estimated cost of diesel since April 16th, spread across the number of
estimated kilowatt-hours used in town in the month of May.
The early conservation effort was also
factored into this estimate, reducing the amount of fuel and the number
of kilowatt-hours.
Because the fuel cost for roughly 45 days
must be spread over a 30 day period, the ECOPA will be 42.9 cents for
bills rendered on May 16th, and until the full billing cycle is
completed. Pending RCA approval, a new ECOPA will go
into effect June 16 to
recover fuel costs as a result of the avalanche. This adjustment
is approximately 3.5 cents per kilowatt-hour. When added to the
normal summer residential rate of 7.9 cents per kWh, the total rate will
be 11.4 cents per kWh. This rate will be in effect for bills sent
out June 16 through July 15. This will be the final Emergency COPA
rate. Will rates ever go back to normal? The emergency COPA will remain in
effect until Snettisham energy is restored and the monthly billing cycle
has made a full revolution ending on the 15th.
After that, we will return to our normal
seasonal rates and normal COPA calculation mechanism.
Is my meter actually read and what is the billing
period?
Yes, only a few meters are
estimated each month, and only when there is a problem gaining access.
About 40% or our meters are read remotely by
either a power line carrier or by receipt of a radio signal.
Bills are always based on actual meter
readings over approximately the prior 30-day period. Why is the ECOPA rate so high when we are using less diesel than was expected? The production cost of making
kilowatt-hours with diesel is the same – about 10 kilowatt-hours per
gallon of diesel, depending on the mix of generating units online.
Using more or less electricity does not
change the cost of producing a kilowatt-hour.
As individuals, businesses and government
buildings use fewer kilowatt-hours, and less diesel, the savings comes
only because of their own conservation efforts…and results in money
saved on bills.
This means that if folks or organizations
are visibly using more energy, the community is not paying for their
greater use of diesel … they pay for the diesel based on their own
kilowatt-hours used. I understand why this rate is needed, but I can’t pay all of this right now! How is AEL&P going to help? The Regulatory Commission of Alaska has recently approved our proposal to modify and expand our levelized payment option. We can now offer all residential and small commercial customers the option of paying an averaged bill over a 12-month period. AEL&P is currently sending a letter to all customers that provide information on payment options, information on what their levelized payment would be if they choose this option, and how they will be able to sign up for the different options. Customers with overdue balances
should call now to work out payment arrangements.
A down payment of 1/3 of the balance is
customary and payments must be maintained according to the agreement to
avoid disconnection.
Payment agreements are tailored to the
customer’s circumstances and their prior success in handling payment
agreements.
Am I eligible for assistance from "Juneau Unplugged?" The City and Borough of Juneau
Assembly approved funding for a grant/loan program for residential
customers who most need assistance.
The program is being administered through If your name is on the May AEL&P bill and your household income is within the limits set by the program, you may qualify for a grant/loan. If you have a small business, talk to the folks at JEDC, 463-3789, about their loan program, or go to www.juneauunplugged.com.
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