Haines Borough Energy Sustainability Commission

Retail Energy Prices in the Chilkat Valley

Retail data is collected from 5 transportation fuel retail outlets, and the sole suppliers for heating fuel (Delta Western) and propane (Haines Propane).

Check back for a more up-to-date graphic for electric rates. APT has been granted a 9% interim "refundable" increase until February 2010. (See the RCA order in the ESC December 9 meeting packet).

The APT monthly residential customer charge has increased from $11.86 to $12.93. The electric rate is $0.1355 per KWH compared to the April '09 rate of $0.1243.

The Alaska State Motor Fuel Tax was reinstated September 1. 2009. Motor fuel tax rates are 0$.08 per gallon on gasoline, diesel, and gasohol for highway use and $0.05 per gallon on the fuels for marine use.

Stove oil and furnance oil, available from a single supplier in the Chilkat Valley (Delta Western).

Propane is also only available from a single supplier (Haines Propane).

February 18, 2010 Two Studies of Rural Fuel Pricing Released by the State of Alaska, Department of Law, Attorney General's Office. The Press Release states that the Attorney General's Report finds the following:

• Wholesale delivery costs to most parts of rural Alaska are high as a result of complicated scheduling, challenging geography, very small volumes over which to spread costs, and regulatory requirements for delivery.
• Based on the information provided for the period under review, high wholesale prices in rural Alaska appear to be driven by high delivery, storage, and logistical costs.
• Taking into account these high delivery, storage, and logistical costs, the average rate of return on invested capital for wholesale suppliers was unremarkable.
• The wide disparity in fuel prices within certain regions across rural Alaska is primarily the result of pricing differences among local retailers.
• Retail margins are the result of conditions that vary among communities. Retail operations in rural Alaska are of a significantly smaller scale than they are in more urban areas. Accordingly, costs associated with these operations must be spread over smaller volumes, which contribute to higher prices.
• Bringing down the high cost of fuel in rural Alaska will be a challenge, but continued efforts in conservation, education, alternative energy development and infrastructure upgrades might produce positive results.
• While this study does not categorically conclude there have been no illegal practices in rural wholesale and retail fuel pricing, investigators found no evidence of such illegal activity.

The ISER (Institute of Social and Economic Research, UAF) study found that recent high prices in Western Alaska are due in part to a convergence of factors including:

• Higher crude oil prices;
• Price recovery among fuel distributors, after earlier competition for market share pushed prices below sustainable levels;
• Repair and replacement of aging tugs and barges, including federally required use of double-hulled tankers; and
• Construction of new fuel tank farms in many communities, with business plans that require pricing to include costs of tank repair and replacement.

Download the Attorney General's Report {Download}

Download the Summary of the ISER report: Market Factors and Characteristics Influencing Rural Alaska Fuel Prices, February 2010 {Download}

Download the complete ISER report {Download}