Alaska Energy Authority reviews Power Cost Equalization program for rural communities

In a recent meeting of the Alaska Legislature's House Community and Regional Affairs Committee, officials from the Alaska Energy Authority (AEA) provided an in-depth overview of the Power Cost Equalization (PCE) program, highlighting its critical role in supporting rural communities across the state. The discussion, led by Executive Director Curtis Thayer and Chief Operating Officer Tim Sandstrom, emphasized the ongoing challenges and successes of the program, which aims to reduce energy costs for Alaskans living in remote areas.

The PCE program, which currently allocates approximately $48 million to 82 electrical utilities, directly impacts around 82,000 residents in rural Alaska. This initiative was established in the 1980s to address the significant disparity in energy costs between urban and rural areas. Sandstrom detailed the program's evolution, noting that it has undergone various iterations since its inception, with the most recent adjustments allowing residential customers to qualify for increased energy credits.

A significant focus of the meeting was on the eligibility criteria for PCE, particularly regarding community facilities. While many public facilities, such as streetlights and clinics, can receive PCE credits, schools are excluded due to their federal and state funding. This exclusion has raised questions among legislators about potential changes to the statute that could allow schools to benefit from the program, especially given the high energy costs they face.

The AEA also discussed its broader mission to enhance Alaska's energy infrastructure, which includes investments in renewable energy and upgrades to aging power systems. The authority is currently working on several projects aimed at improving energy reliability and efficiency in rural areas, where many powerhouses and fuel storage facilities are in dire need of maintenance and modernization.

Despite the positive strides made by the PCE program, concerns were raised about funding levels and the sustainability of the program in the face of increasing demand. Legislators expressed apprehension that if more community facilities were added to the PCE program, it could strain the existing budget, potentially leading to a proration of funds.

In conclusion, the meeting underscored the importance of the PCE program in supporting rural Alaskans and the ongoing efforts by the AEA to address energy challenges in the state. As discussions continue, the legislature faces critical decisions regarding the future of energy assistance programs and their impact on community resources. The AEA's commitment to improving energy access and reliability remains a vital component of Alaska's energy strategy, with further developments expected in the coming months.