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Questions about the mines

by | Sep 9, 2010 | Pogo and Fort Knox, Rates | 2 comments

“If Golden Valley wasn’t providing power to Fort Knox and Pogo mines, would we still need all the diesel-fired generation that is in operation now? What percentage of the power generated by GVEA goes to those mines? When those mines came on, we were told they’d cause our rates to drop. Do Fort Knox and Pogo pay the same rates I do as a residential customer? Interested rate-payers want to know!”  wrote a member recently.

These are such great questions, I thought they deserved a home on our main blog page (instead of being buried on the About GVEA page).

1. If Golden Valley weren’t providing power to Fort Knox and Pogo mines, would we still need all of the diesel-fired generation that is in operation now? Yes, absolutely. In order to maintain reliability, we need the generation facilities we have today. We do not have one specific power plant dedicated to Fort Knox and Pogo mines.

2. What percentage of power generated by GVEA goes to those mines? In 2009, GVEA sold 1.31 billion kilowatt-hours. Some of that power was purchased from Aurora Energy and Chugach Electric in Anchorage. Pogo and Fort Knox accounted for 26 percent of Golden Valley’s total sales.

3. When those mines came on, we were told they’d cause our rates to drop. When Fort Knox came online in 1997, members saw a Fort Knox credit on their bill. The verbiage read “Your fuel credit of ____ per kWh resulted from GVEA’s reduced fuel costs, economy energy purchases and Ft. Knox gold mine margins.”

4. Do Fort Knox and Pogo pay the same rates I do as a residential customer? No, they pay an industrial rate. All GVEA members pay for their cost of service as filed with the Regulatory Commission of Alaska. During our latest rate case, it was found that these large industrial members (like Fort Knox and Pogo) were overpaying by 5.1 percent. They chose to forgo this decrease and pass the savings on to the rest of the membership.

Further questions? Don’t hesitate to ask.

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Meadow Bailey

907-451-5676
pr@gvea.com

Ashley Bradish

907-458-4518
pr@gvea.com

Grace Wilson

907-451-5847
pr@gvea.com

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