High Electricity Costs in Alaska Remain a Concern for Residents

Residents of Anchorage are facing high electricity costs, with most Chugach Electric members paying 22.5 cents per kilowatt-hour, well above the national average. Rural Alaskans are also experiencing even higher costs, with limited signs of improvement on the horizon.

One of the major issues contributing to these high costs is the control of nearly 90% of Cook Inlet gas supply by a single company, Hilcorp, leading to a functional monopoly. Antitrust laws exist to prevent such monopolies from taking advantage of consumers by driving up prices through restricting supply. Despite claims of insufficient reserves by Hilcorp, smaller operators have reported the discovery of untapped gas pools.

Efforts to keep Hilcorp’s monopoly power in check have been made, with investigations in 2012 and a negotiated consent decree signed by the Alaska attorney general. However, recent developments have seen Hilcorp informing Alaska utilities that it will not renew gas contracts, potentially leading to price hikes in the future. The Dunleavy administration has been criticized for failing to hold Hilcorp accountable for its actions.

With the attorney general’s authority to audit Hilcorp set to expire in 2024, concerns are growing about the lack of action being taken to address the gas crisis in Alaska. Calls have been made for the FTC to resume its investigation, as residents are left with uncertainty about the future of their utility bills.