HomeMy WebLinkAboutAlaska Energy Overview
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Alaska Energy Overview
Alaska’s Energy Portfolio
The vast majority of the Alaska’s population and energy activity is concentrated in one region known as the Railbelt. This
region generally comprises the areas surrounding the Alaska Railroad including Fairbanks, Anchorage, Homer and all of
the communities in between. The Railbelt generates about three quarters of power statewide. Railbelt residential
electric consumers use an annual average of around 650 kilowatt-hours (kWh’s) per month.
With the exception of a handful of relatively large, isolated communities, the rest of Alaska is colloquially classified as
rural. Rural communities typically source both their electricity and heat energy from diesel with some variation in
resource mix by region. In general, coastal regions have greater access to hydro energy, western regions have greater
access to wind energy, and densely forested regions have greater access to biomass energy (for heat). A typical
household in a small rural community consumes a little under 300 kWh/month on an average annual basis.
For planning and policy purposes, AEA categorizes the state into eleven energy regions. The Railbelt region generates
about a third of its electricity with renewables. The Southeast and Kodiak regions have nearly 100% renewable electric
penetration. The Copper River/Chugach regions source about two thirds of electricity from renewables. The other seven
regions generate less than a tenth of their electricity with renewable resources. Statewide, approximately 30% of utility-
scale electricity comes from renewable sources.
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Power Cost Equalization
The Power Cost Equalization (PCE) program assists the customers of rural electric utilities by paying part of their electric
costs. The first 500 kWhs on a household’s monthly bill are eligible for PCE assistance as well as a population-driven
number of kWhs to eligible community facilities. Nearly 83,000 people live in the 191 communities that participated in
the PCE program during FY2016. Disbursements to those communities totaled approximately $31 million. The weighted
average residential rate in PCE communities was $0.45 per kWh in FY16. The portion reimbursed by the PCE program
was $0.24 (55%), resulting in an average household effective rate of $0.21 per kWh for eligible kWh’s sold. In a typical
rural community around 40% of kWh’s are eligible for the PCE subsidy.
$0.00
$0.20
$0.40
$0.60
$0.80
$1.00
$1.20
$1.40
$1.60
$1.80
$/kWhResidential Electricity Rates in PCE Communities, FY16
Effective Rate PCE Reimbursement Base Rate, $0.1582 in FY16