Wind now keeps GVEA rates down
This content was originally published by FCAC member Knicely as a community perspective in the Fairbanks Daily Newsminer.
At the end of February, GVEA announced a rate hike that is going to hurt for many Interior residents. It amounts to an average $29 a month increase, starting March 1. At the Feb. 27th board meeting, GVEA CEO John Burns acknowledged that the cause of the increase is the fact that GVEA hasn’t diversified our energy production enough. The rate hike comes after a 38 day period where the Healy 2 coal plant was offline, made worse by a sudden decrease in methane gas energy coming up from Cook Inlet.
At the same meeting, the board also announced that they will be amending the Strategic Generation Plan they committed to in 2022, which would have replaced the Healy 2 coal plant with cheaper and more reliable energy sources, including wind. The board had committed to shutting down Healy 2 by the end of 2024. Since they have not secured the necessary energy replacements in time, they have now amended the plan to keep Healy 2 online “indefinitely” until they come up with alternative energy sources. Meanwhile, GVEA still hasn’t signed a power purchase agreement with either of the two available wind projects, Shovel Creek and Delta Wind. Once online, the Shovel Creek Wind Project would produce three times the power that Healy 2 currently does at peak generation, at a 30% reduced price from what we were paying before the price hike. Meanwhile, Delta Wind could be online by 2025, and would also be some of the lowest cost power GVEA currently purchases.
Right now, wind is the energy source that can be scaled up the fastest. Natural gas and coal plants require several years to be built, and that’s in the best of conditions, not Alaska conditions. Community solar also has a place in mitigating this energy crisis. Community solar (which is currently in the Legislature, in the form of SB152 and HB 328), uses economies of scale to make the benefits of solar more accessible to the general public, lowering energy bills for ratepayers who may not have access to a home solar system, due to a variety of reasons, including being a renter or lack of upfront funds for installation. Diverse production means robust production, and decreases the likelihood that multiple systems will fail at one time or that price volatility will wreck our bank accounts. The different energy sources act as a team — the strengths of one source cover for the relative weaknesses in others.
But we need GVEA to act fast. In 2022, Hilcorp, the main supplier of energy from Cook Inlet natural gas, warned that it would not be able to renew long-term contracts with energy utilities due to the unclear availability of its natural gas resources.
We’re seeing the effects of this now, as there is less power available from the Intertie, and we’ll continue to see rising prices the longer we rely on expensive and unreliable fossil fuel energy sources, which currently make up 91% of GVEA’s energy generation. Meanwhile, renewable energy is already cheaper, and will only continue to decrease in cost.
This rate hike is a surcharge due to GVEA’s continued reliance on fossil fuels. It is critical that GVEA invests in large scale wind energy projects as soon as possible to avoid continued price increases, to localize our energy sources and improve Alaskan energy security, and to commit to producing power in a way that doesn’t negatively affect our air quality and our health.
If you’re concerned about your bill increase, you can take action in three ways:
1. You can email the board using the link at gvea.com/meet-your-board-of-directors. If you pay an electric bill, then you’re a member-owner and have a voice at GVEA. Let them know you want them to take quicker action on switching to renewables, so we don’t continue to see rate hikes due to reliance on the volatile fossil fuel market. You can also speak up by attending GVEA’s next board meeting on March 26. More info on how to join can be found at gvea.com/meetings-minutes.
2) Vote in the upcoming GVEA election. Districts 4 and 7 have elections this spring. Find your district here: gvea.com/elections.
3) Get involved with Fairbanks Climate Action Coalition’s Renewable Energy Working Group. Go here for more information: fbxclimateaction.org.
