KENAI, Alaska (AP) — An Alaska electric utility has announced a rate increase, but does not plan to cut service to residents facing financial hardship who do not pay their bills.

The Homer Electric Association said the rate hike took effect on April 1, The Peninsula Clarion reported Tuesday.

The cost of power adjustment rate is updated quarterly to reflect the actual cost of natural gas used to generate power for customers, the company said in a statement.

The rate has changed from $0.062 to $0.077 per kilowatt-hour. The average residential customer using 550 kWh per month will have a bill increase of $8.60, the company said.

The increase was driven by last quarter’s “unusually low” adjustment rate and an increase in fuel costs, the company said.

The adjustment rate was low late last year due to unusually high water levels at Bradley Lake, where the association generates hydroelectric power, the company said.


Electric service will not be disconnected to customers who do not pay because of financial hardships, but those households will still be responsible for electricity bills, said Bruce Shelley, Homer Electric Association director of member relations.

“HEA continues to look for solutions to help our members through this challenging time,” Shelley said.

The Alaska Legislature passed a bill preventing utility companies from disconnecting services to residents experiencing financial hardships because of the coronavirus pandemic.

The state protection will continue while the health emergency is in effect or before Nov. 15, whichever is earlier, the bill said.

For most people, the coronavirus causes mild or moderate symptoms, such as fever and cough that clear up in two to three weeks. For some, especially older adults and people with existing health problems, it can cause more severe illness, including pneumonia and death.