Anchorage Daily News

Enstar Natural Gas Co. plans to raise its rates for heating homes by at least 22 percent starting in January to pay for soaring fuel costs, one of its largest one-time rate increases in a decade.

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George Vakalis

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The company will file its new prices with the Regulatory Commission of Alaska for approval when its final numbers are in next month, said company spokesman Curtis Thayer.

Enstar, which serves about 128,000 homes and businesses statewide, including nearly all of Anchorage, will raise a typical resident's bill from $125 to $153 a month on average.

"This is a concern," said Ann Secrest, spokeswoman for AARP Alaska, which has more than 90,000 members. "You don't want an older Alaskan to have to turn off their heat and possibly put themselves in harm's way."

Enstar says it will work with customers to help pay the higher bills. The company will develop payment plans or assist lower-income residents with applying for the Alaska Heating Assistance Program, which pays grants directly to the utility on behalf of the customer.

Alaskans can also apply for the Home Energy Rebate Program through the Alaska Housing Finance Corp. Alaska Legislators gave the program $160 million this year. It allows homeowners to recoup costs from making energy-efficiency improvements. For lower income residents, the state weatherization program can help seal up a home for better heating efficiency.

Across the country, utility companies are boosting rates as a result of the global surge in energy prices. In August, the Alaska Legislature approved a $1,200 energy rebate for each state resident to help offset the increasing costs. The state is doling out the money on Friday to most Alaskans.

The contracts Enstar has with its Cook Inlet gas suppliers are based on oil prices. When the cost of oil increases, those costs are passed on to customers. Enstar says it will not be making any profit off the rate increase.

Two years ago, a similar spike in oil prices sent Enstar natural gas rates soaring to a 30 percent increase.

Even with the latest increase, though, Enstar customers will have one of the lowest prices of natural gas in the country, Thayer said. And, on average, customers will still be paying less than other customers in Alaska using other ways to keep warm. "Natural gas is still the most inexpensive way to heat your homes," he said.

PAINED POCKETBOOKS

As for what the future holds for customers, Thayer was not optimistic prices will get any better. Enstar is looking at building a pipeline from the Brooks Range to Southcentral Alaska, and that will require investment, he said. "Prices are not going to go down."

For big customers like the Anchorage School District, the cost will be a pounding on their budgets. George Vakalis, assistant superintendent for support services for Anchorage public schools, said the increase will amount to about $900,000 of unbudgeted costs. Typically, when extra costs hit the district, administrators begin to look at what programs need to be cut, he said.

Outside the Home Depot in East Anchorage on Monday afternoon, Valley resident John Comer echoed what many are saying, "People are going to start scaling back," he said. "Thermostats are being turned down. Hot water temperatures are being turned down."

David Doucett, who owns two multiplexes in Mountain View, said he spent much of the summer caulking and working on energy improvements to his properties. "The only thing we can do is make sure everything is sealed up," he said.

He also just sent notices to his renters saying he is raising rent by $25 a month to help pay for heating.

Carol Perkins, with Wasilla-based Active Inspections and Energy Ratings, said the increase will likely mean even more phone calls to her business. "It's going to double my workload," said the energy rater who inspects people's homes and tells them how they can save on energy costs. "People are going to be even more frantic about getting the rebate programs done."

She also anticipates the installation of more wood stoves.

Find Megan Holland online at adn.com/contact/mholland or call 257-4343.

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