NJUS looks at utility price increases

The fuel surcharge on utility bills has dropped by 3.25 percent. Nome Joint Utilities System adds this per kilowatt charge to the customer’s monthly electrical power usage.
The reduction, effective with August bills, resulted from a decision based on lower-priced fuel flowing into NJUS tank farm, according to John K. Handeland, utility manager. Handeland noted that customers would see electrical charges drop by around $13 give or take depending on consumption. NJUS took delivery of 2.2 million gallons of fuel this summer at a cost of $2.24 per gallon, inclusive of port fees. Thus the fuel surcharge has dropped from 14.4 cents per gallon to 11 cents per gallon.
The decrease comes at a good time, Handeland said, as it will soften the impact of a reduction of Power Cost Equalization assistance from State of Alaska. That figure has dropped from 14.39 to 12.74 cents.
However, the cost relief, while minimal, may also be short lived. Water and sewer charges may be going up. The NJUS Board of Directors at their Sept. 22 meeting, based on information from Handeland during his financial report, started looking at an increase in sewer and water rates.
The Board pored over rate schedules associated with amending the utility tariff to make changes in an effort to meet increasing costs of operating the sewer and water systems and to make the services pay for themselves.
A rate study that NJUS commissioned several years ago shows that in spite of rate changes averaging 12 percent in 2014, at least a 24 percent deficit still stood the way of making water and sewer able to support themselves. In 2015, NJUS implemented a 10 percent increase to address the deficit.
At the most recent meeting Sept. 15, another resolution came forward asking the board to vote another 10 percent “adjustment” to residential and commercial rates for water and sewer services. The approved resolution would send the issue before the Nome Common Council with the aim decreasing the reliance of water and sewer on electric services subsidies.
If the council approved the increases, residential cost for water would be $49.01 per month; sewer, $58.81; combined cost, $107.82. For persons over 65 years old, the rates would be water, $29.40; sewer, $35.29; combined cost, $64.69.
But the NJUS Board of Directors tabled the resolution pending more information and discussion. The issue will appear on the agenda again next month.
The current rates adopted in 2015 are water, $44.55 and sewer, $53.47—for persons age 65 and over, the costs are $26.73 and $32.08.

The Nome Nugget

PO Box 610
Nome, Alaska 99762

Phone: (907) 443-5235
Fax: (907) 443-5112


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