Anyone familiar with Alaska's partial deregulation mess? Chugach Electric here in Anchorage has this weird hybrid system where large customers can choose generation suppliers but small customers are stuck with bundled rates. My client is paying $0.195/kWh all-in while comparable customers in the Lower 48 pay $0.08-$0.12. The delivery charges alone are $0.089/kWh due to our isolated grid. Is there any way to audit these costs or are we just stuck with monopoly pricing?
Alaska deregulation nightmare - Chugach Electric
Scott, that's brutal pricing but not surprising for Alaska. Here in South Dakota we pay $0.085 all-in with Xcel Energy. Your delivery charges seem excessive even accounting for the remote location. Check if Chugach is properly allocating transmission costs - sometimes they bundle in costs that should be separate line items. Also verify they're not double-charging for grid modernization or reliability improvements.
Alaska's situation is unique but you should still audit the supply component. Even in isolated markets, generation costs can be inflated through poor contracting or affiliate transactions. Here in New Orleans with Entergy we see similar issues on a smaller scale. Request detailed cost breakdowns for fuel, purchased power, and capacity charges. The RCA should have these on file.
I've worked with some Alaska industrial clients and Scott's right - the pricing is just brutal up there. But definitely audit the demand charges and power factor penalties. Chugach has some of the highest demand rates in the country at $18-22/kW. Make sure your client isn't getting hit with reactive power charges that could be avoided with better power factor correction. That alone could save 10-15% on the bill.