Homer Electric's cost-of-power charge rises, adding $7.92 to an average monthly bill

Homer Electric Association raised its Cost of Power Adjustment from 10.32 to 11.76 cents per kilowatt-hour Oct. 1. The change adds $7.92 to the monthly bill of an average residential member using 550 kilowatt-hours, according to the cooperative's October 2026 monthly CEO report.

The charge is set each quarter, separately from the base rate. It reflects "primarily the cost of fuel and power purchased from the Bradley Lake Hydroelectric Project," the report says. The report does not say whether fuel or Bradley Lake costs drove this increase.

Islanding has moved the charge before. Islanding means running cut off from the wider Alaska grid. HEA's July report credited that quarter's cut partly to fewer hours of islanding, because being connected to the grid reduces the spinning reserves HEA must carry on its own. It also credited greater-than-expected sales.

HEA expects about 117 days of scheduled islanding over the next 12 months, plus a 65-day outage at its Nikiski Combined Cycle plant. The utility has limited its use of Bradley Lake power to save water for the islanding planned in 2027, the October report says.

The charge has gone up and down this year. It fell 14.8 percent Jan. 1, to 9.317 cents, which more than offset a 4 percent base-rate increase that took effect the same day. It rose to 10.922 cents April 1 and fell to 10.323 cents July 1. A year ago, the October 2025 increase was 2.3 percent, worth $1.36 a month.

Alaska News reported Sept. 5 that HEA lost about $2.2 million on June operations, as purchased power ran over budget. HEA's September report said that overrun largely reflects billing by its generation subsidiary, Alaska Electric & Energy Cooperative, whose margins HEA records at year end.

In August, HEA took in $11 million against $10.4 million in cost of service, a margin of about $0.6 million. Year-to-date margins of $1.6 million are about $0.5 million above budget, or $6.3 million with the subsidiary included, the October report says.

Tree-related outages fell to 221 through September, from 335 over the same period in 2025. HEA credited its vegetation management work.