Did HEA or the RCA consider the economic implications for Homer residents and businesses?
No. The RCA’s decision to approve the rate increase, said Salazar, was based solely on the supporting documentation provided by HEA in December. For this type of rate increase – a COPA adjustment – public hearings are not required. As for HEA, spokesperson Joe Gallagher said the rate increase was directly due to increases in the cost of wholesale power they purchase from Chugach Electric Association and HEA’s methodology for calculating such an increase does not allow for “non-objective factors” like potential economic impact to the community. “The economic impact is not something that is factored in to the rate adjustment. The fuel costs are passed on to HEA and it has to be paid for,” said Gallagher. Was there an accounting or billing error on the part of Chugach Electric that led the increase? According to Gallagher, there was not. An underestimation of their fuel costs, however, did play a factor. Chugach set their Fuel Coast Rate Adjustment, an estimation of quarterly fuel costs,
