FAIRBANKS, Alaska (AP) - About 70 customers in downtown Fairbanks who get steam heat from a utility will see their bills temporarily increase by 43 percent.
The Regulatory Commission of Alaska approved the rate increase last week for Aurora Energy, the Fairbanks Daily News-Miner (https://is.gd/AuH9Xt ) reported on Wednesday.
Customers will now pay $15 per 1,000 pounds of steam generated by the coal-fired plant also located downtown.
Aurora wants to eventually hike the price to $20.45 per 1,000 pounds of steam, but the commission delayed its final decision on that request at least until the end of July.
If the rate increase is denied, customers would receive refunds for the amount of the interim increase.
In a December filing with the commission, Aurora said revenue from the service only covers about half its costs. Company President A.L. “Buki” Wright noted there had not been a price increase in 28 years.
An increase to $20.45 per 1,000 pounds of steam would amount to a 95 percent price hike for customers. The utility said that would allow it to recover some of the revenue it has lost by going without an increase for nearly three decades, and to prepare for infrastructure replacement.
Twelve people protested the interim rate increase, including Fairbanks Mayor John Eberhart.
Among the customers receiving steam heat are large offices such as the KeyBank building and Courthouse Square.
Steam is a cheaper alternative to other heat sources in Fairbanks. It’s about a third of the cost of fuel oil and half the cost of unregulated hot water service, also provided by the utility.
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Information from: Fairbanks (Alaska) Daily News-Miner, https://www.newsminer.com
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