Power Cost Equalization UpdatePosted: July 17, 2019
As many of our members already know, failure of the legislature to pass “Reverse Sweep” language last month has resulted in funding for this year’s PCE becoming unavailable.
The good news is that both the Governor’s proposed budget and the Legislature’s passed budget included full funding for PCE. The Legislature’s budget identified the PCE Endowment Fund as the funding source. The administration has determined that the PCE Endowment is a “sweepable” fund and, since the legislature did not pass Reverse Sweep language, the fund has effectively been swept into the Constitutional Budget Reserve.
Although the Legislature is actively engaged in efforts to restore funding for PCE, there is no guarantee that they will be successful. In effect, electricity you are using today is not eligible for PCE unless a funding source is established. Today (July 17) the Governor amended the special session call and has summoned all legislators to Juneau immediately. We are hopeful this means that funds for PCE will be restored shortly.
The Regulatory Commission of Alaska is the agency that determines what your PCE rate is. This week they formally notified utilities participating in PCE that there are no funds available to reimburse utilities for credits applied during the current fiscal year. Unless something changes during the month of July, bills to be issued in early August will not reflect PCE and the full cost of electricity will be borne by our members.
AVEC members received $11 million in PCE in 2018. Loss of this funding will be catastrophic – particularly to vital local entities like water and sewer facilities and other public services. Let the Governor and the Legislature know that you support their efforts to ensure that this critical program is funded for FY20 and beyond.