September 16, 2019
Cost of Power
Adjustment charge to decrease in 4
th quarter to $0.018916
Interruptible sales in
rd quarter contributed to the decrease.
Reservoir levels are below normal - Greens Creek, Princess Cruise Ships and Dual Fuel customers are disconnected.
Striking the right balance between conserving water for future use and
selling surplus energy, which provides a cost reduction to customers, is
something we continuously reevaluate and adjust. Forecasting
on isn’t an exact science. We
consider forecasts from multiple sources, including NWS/NOAA in helping
to determine the best course of action.
Reservoir levels need to improve significantly before the interruptible loads can be reconnected.
By the numbers: Normal precipitation at Snettisham for July, August and
September is 46.94 inches. To date this year, Snettisham received only
17.47 inches for that same period.
September 3, 2019
Even with the rain we received over the prior weekend, our reservoirs are still lower than normal for this time of year. Precipitation is still below normal for the water year and a few inches below last year. Snettisham precipitation for the month of August was 5.68 inches below normal..
All Interruptible customers are disconnected until our reservoirs return to normal levels.
August 14, 2019
With little precipitation this month, the reservoirs have not filled as quickly as normal. Water year to date is now both below normal and below last year. Greens Creek, Princess Cruise Ships and Dual Fuel customers will be disconnected and will generate with their own power or heat with an alternate fuel source.
Striking the right balance between conserving water for future use and selling surplus energy, which provides a cost reduction to customers, is something we are continuously reevaluating and adjusting.
As we know, forecasting precipitation isn’t an exact science. We consider forecasts from multiple sources, including NWS and NOAA in helping to determine the best course of action.
We will continue to monitor reservoir conditions and adjust accordingly. Normal precipitation this fall is needed to reconnect interruptible loads.
By the numbers: Normal August precipitation at Snettisham is 14 inches. September is 25 inches. August precipitation to date at Snettisham is measuring less than one inch.
For more information, call 780.2222 or use the contact us form available on our website aelp.com
August 6, 2019
Generation update for early August: Juneau remains in a drought per the National Weather Service, and our reservoir levels are slightly below where they would normally be this time of year. Right now our dual fuel customers and Princess Cruise Lines are being served with hydro power, and Greens Creek is on partial hydro power.
We continue to monitor our reservoir levels closely, and will adjust service to interruptible loads as necessary. The climate prediction for the remainder of August is for drier than normal weather.
July 8, 2019
As of the end of June, the Juneau area has been downgraded from a Moderate Drought back to Abnormally Dry.
The Juneau area reservoir levels are currently near normal for this time of year and are expected to continue to be unless late summer/fall precipitation is below normal as it was in water year 2018.
Currently, all customers are on hydro. Dual Fuel and Princess Cruises are being served with 100% hydro. Greens Creek is taking partial hydro from us and running their own generation in parallel.
June 6, 2019
Lake levels are improving but normal precipitation is needed through the rest of the spring, summer and fall to refill them for the winter. The dual fuel heating customers and Princess Cruise Lines are being served with interruptible energy in full, and the Greens Creek Mine is being partially supplied with hydroelectricity. AELP is monitoring the situation closely and actively managing our resources to maximize hydroelectric generation.
April 1, 2019
Lake levels improve. Interruptible customers to be reconnected.
Although the official drought status continues in Southeast Alaska, the warm weather in March resulted in reduced loads which helped our lake levels improve. The warm weather also started the inflows from snow melt into the reservoirs sooner than expected. These conditions combined allow us to begin reconnecting interruptible customers.
We are starting with dual fuel customers. We plan to bring Greens Creek back on later this month and expect to connect cruise ships when they arrive for the season.
We will continue to monitor lake levels to ensure that we are able to meet all firm customer loads and prudently sell surplus energy as doing so provides a financial benefit to our customers and an environmental benefit to the community.
March 15, 2019
Customer bills will increase for April, May and June of 2019.
In December, we alerted customers that abnormally low rainfall and the resulting low reservoir levels would temporarily increase bills from January through at least June. That is still the case, and because reservoir conditions have worsened since December, there will be an increase of just under 1¢ per kWh in the 2nd quarter COPA (affecting bills in April, May and June).
Each quarter our Cost of Power Adjustment (COPA) is calculated and submitted to the Regulatory Commission of Alaska.
The average residential customer using 850 kWh a month can expect to see an increase of $7.72 to their bill as compared to the first quarter (Jan – Mar).
This increase is temporary. Once reservoir levels recover, we will again sell surplus energy to our interruptible customers.
Interruptible sales provide a reduction/credit to firm customer bills. Our COPA was a credit from January 2014 through December 2018 (five full years) due to sales to interruptible customers.
A little more about how this happened:
Our primary power sources are hydroelectric. When we get a normal amount of rain and snow, we can serve all firm and non-firm (interruptible) customers in our service area with existing hydro projects.
The system is designed so that, in years with normal precipitation, our interruptible customers share the cost of our system with our firm customers. Energy sales to interruptible customers reduce the amount firm customers pay each month.
In times with extended periods of below-average rain and snow – like the one we are in now -- our system is dedicated to our firm customers, which means firm customers pay the full cost without any discount.
How dry are we?
Drought conditions that began in Southeast Alaska in 2018 and persist in the current period have resulted in significantly lower precipitation at Snettisham (our main reservoir) and have caused us to stop making surplus energy available to interruptible customers.
In a normal water year, precipitation at Snettisham is 172.37 inches. The 2018 water year delivered only 135.52 inches to Snettisham, which is 79% of normal.
For the current water year to date (October to the end of February), normal precipitation is 90.48 inches; however, Snettisham has only seen 79.16 inches.
Low precipitation in 2018 left reservoirs lower than normal, and now that the current water year is also below normal, we have not made up the 2018 deficit.
Are we burning diesel?
No, we are not.
Why don’t we just build another hydro plant so this doesn’t happen in the future?
The short answer is that doing so would raise rates all the time, rather than just having rates increase during years with low precipitation.
Here’s the long answer:
Utilities work hard to balance generation capability with how much energy is needed in the community. AEL&P can meet all firm and non-firm (interruptible) customer needs in an average water year with our existing projects, so if we built another hydro project, in most years we would end up with much more energy than we need. The problem with this is that the project costs the same amount no matter how much energy is used. For example, if we can only sell half the energy we generate, the cost per unit is double what it would be if we were able to sell all the energy. On the other hand, if you don’t have enough hydro generation, then you risk needing significant diesel generation, especially in low water years.
In Juneau’s case, adding a hydro facility now to meet interruptible loads would add hundreds of thousands (and possibly millions) of dollars in additional costs each year. This would increase electric rates for everyone because we would not be able to sell any of that additional energy in most years. If we had built a new project in 2014 to prepare for a low water year, none of the energy from that additional facility would have been needed during the last 5 years. And only a fraction of it would have been needed in the last 6 months.
If Juneau’s electrical system was interconnected to a grid, like you see down south, then building more hydro to be prepared for a dry year might make more sense because we could sell the extra energy to customers outside of our community. But in our isolated system that isn’t connected to the grid, it would be economically damaging to our community if we built more than we can sell.
As a result of careful resource planning, interruptible loads, and responsible stewardship, AEL&P’s residential rates are the lowest among regulated utilities in Alaska, and lower than the national average. In addition, over the last five years, interruptible sales reduced the amount the average residential customer paid each month by $29.50.
We understand the impact that higher rates can have on our customers. Please give us a call at 780.2222 to speak with our energy specialist about ways to lower your usage and reduce your bill, or to speak with our credit counselor.