Many Southeast Alaska homeowners are converting to electric heat pumps as a way to reduce reliance on fossil fuels and improve air quality. But in some of Southeast’s smallest communities, the high cost of electricity makes operating them unaffordable. A recent study found that offering a special rate for heat pumps in the Kupreanof Island village of Kake and other remote communities could help the electric utility, the environment and the consumer.

Kake resident Adam Davis decided to convert to a heat pump about four years ago. Before that, he was using a pellet stove, but barging in fuel was getting expensive. 

When Tlingit-Haida Regional Housing Authority offered to install a heat pump for free as part of a pilot program, it piqued his curiosity.

“I was willing to be a guinea pig to see whether or not they were viable here,” he said.

Davis doesn’t have any complaints about his air source heat pump. The devices can work like an air conditioner, using electricity to move hot air outside during the summer. But unlike an air conditioner, they can also move warm air into the home to provide heat in the winter. They also provide added benefits like air filtration, compared to wood and oil heating, which can reduce indoor and outdoor air quality. 

Davis said maintaining and operating the heat pump is also a lot easier than the pellet stove, and he’s only seen a slight increase in his electricity bill. Even with that increase, he thinks he’s saved money not having to buy the pellets for his stove. 

But that wouldn’t be the case if it was his only source of heat, especially when temperatures drop below freezing. He also has propane and oil heaters for his nearly 2000-square-foot home.

“I see them as a great, you know, complementary type of heat source. Not as a primary heat source just because of the wide swings in our temperature here,” he said. “I don’t think you can rely on them in the coldest of months.”

Davis is one of six Kake residents to benefit from the program so far, including a few of his neighbors. He said they installed heat pumps as their only source of heat and their electric bills skyrocketed, minimizing or eliminating savings from not having to buy heating fuel.

Like many rural Alaska communities, the cost of electricity in Kake is high: 1.5 times the state average and 2.5 times the national. And that’s when you factor in something called Power Cost Equalization, a state program that subsidizes rural energy costs. In Kake, any usage over 500 kilowatt hours a month is about double the cost because it isn’t covered by the program. And the added electrical demand of heat pumps can easily push a household over that threshold.

That’s one of the reasons the Inside Passage Electrical Cooperative or IPEC worked with the Alaska Center for Energy and Power to study whether a lower rate for heat pump users might be a good fit for Kake and the four other communities they serve.

“I do understand that people are having a hard time, you know, those who have heat pumps are having a hard time paying the extra amount on their electric bill every month,” IPEC CEO Jodi Mitchell said. “And so some of them are really struggling with that.”

She said it’s expensive to provide electricity to the remote communities IPEC serves because they each have their own infrastructure, like diesel generators or hydroelectric dams. And IPEC has way less customers to carry the burden of those fixed costs than in a city. As customers cut back on electrical use and introduce energy efficiency measures to try and save money, it can actually make rates per kilowatt hour go up because the utility still needs a minimum amount of money coming in to keep things running. 

“People always say IPEC has to be more efficient, and IPEC’s customers need to be more efficient. It doesn’t work that way because of the economies of scale factor,” Mitchell said. “The more we sell the cheaper it is for everybody. That’s it in a nutshell.”

Introducing a special rate for heat pumps could encourage more customers to use them, and the money they’d normally spend on imported fuels would go toward electricity instead. And even though IPEC would absorb the cost of the special rate, the study shows that it’s still worth it financially because it would help them sell more power.

The study also shows that, with the special rate, consumers would save money on heating in the long run, even if they have to cover the cost of the heat pump and installation. But with the program Davis benefited from, that could come for free.

And finally, in places like Kake where renewable hydropower is in play, heat pumps are a win for the environment because they replace non-renewable fossil fuels with clean energy.

Mitchell is excited about the findings, but also recognizes their limitations. IPEC doesn’t want to overload their microgrids either. They’ll likely have to limit the number of residents who can benefit from the special rate, which would apply to any usage over 500 kWh a month.

“So we’re trying to find this sweet spot: how many can we allow, assuming that our system was using a peak demand from like January? If we added this much more burden on our electric system, would we have to start up another generator? And that’s what we want to avoid,” Mitchell said.

The study put that sweet spot at about a quarter of Kake households installing heat pumps. 

Gary Williams is a former Executive Director of Kake’s Tribal government, the Organized Village of Kake. He’s been working on a grant-funded project to study heat pumps and electric vehicles to help Kake address energy issues, and hopes IPEC will implement the special rate.

“Because without that rate for heat pumps and EVs, it quite frankly, probably wouldn’t be practical,” he said.

He said looking to alternative solutions to address the high cost of energy in Kake is imperative. It doesn’t just impact households; it has a broader effect on the entire economic development of the town.

“Time after time, we’re faced with the high cost of electricity just making it impractical and unfeasible for anyone to develop new businesses,” Williams said.

IPEC plans to hold a meeting with its members in early June to discuss the special rate for heat pump users. If implemented, customers would apply on a first-come, first-served basis. 

Erin McKinstry is a Report for America corps member. This story was produced in collaboration with Alaska’s Energy Desk.

Adam Davis of the Organized Village of Kake leads a group of energy experts into the forest around his home community of Kake to explore micro-hydroelectic opportunities. (Photo courtesy of Sustainable Southeast Partnership.)

Representatives from communities in Southeast met up in Sitka last week to talk food security, energy, resource management and economic development. They are members of the Sustainable Southeast Partnership, a collaboration to address these challenges through collaborative projects and educational workshops. KCAW’s Brielle Schaeffer has more.

Downloadable audio.

By next fall, Lindsey Hershey hopes to have a childcare center and chicken coop in Yakutat. And she’s also planning to have a community garden up and running.

“Yakutat doesn’t have an actually childcare facility right now I don’t think they have any childcare providers and it’s just going to provide stability for the parents,” she said.

While the childcare center addresses an immediate need, a chicken coop is tackling a future problem.

“The cost of eggs is supposed to go up drastically next year,” she said.

Hershey is a community developer for the City and Borough of Yakutat. She spent the week in Sitka working with the Sustainable Southeast Partnership to address problems in her hometown, and develop new ideas like a mobile, community garden.

“Yakutat has a lot of potential but they need somebody on the ground,” Hershey said.

And this group is devoted to showing folks like Hershey how to harness that potential. Energy, food, and the economy are big concerns for many communities throughout Southeast. Alana Peterson, Sustainable Southeast Partnership’s program director, says the key to the coalition is coming up with unique projects that can meet the needs of communities as big as Juneau or small as Hydaberg

One size does not fit all.

“All these partners come to the table with different resources, different capacities and we are basically just networking and seeing how we can work together and pool those resources,” Peterson said.

The mission of the coalition is “creating resilient peoples and place.” The Sustainable Southeast Partnership was started four years ago and includes watershed councils, tribal and city governments, and private entities. In Sitka, the partnership helped start Sitka Kitch, a shared community kitchen with classes on regional food preparation and preserving.

In Kake, partners are working on alternative energy and economic development projects. Adam Davis of the Organized Village of Kake says energy is a huge barrier to starting and sustaining businesses. For many households, he says, alternative energy is not an option.

“People are already strapped for cash as it is just keeping their monthly bills rolling so it’s kind of hard to make these investments in solar panels or microhydro turbines or wind for your home when you’re just barely getting by as it is,” Davis said.

However, the village is hoping to harness energy from Gunnuk Creek. Davis says the Inside Passage Electric Cooperative is looking into a hydro project that could potentially supply half of Kake’s energy needs.

“With these increased rains it does look like it’s going to be a viable option to get us off diesel at least when it’s raining so it does rain a lot,” Davis said. “Can’t wait for the day we can actually turn off our diesel generators even if it’s only part time.”

The village is also planning to renovate the historic Kake Cannery as a way to create jobs.

It’s one thing to generate these ideas and it’s another thing to get them going. The Sustainable Southeast Partnership provides a network for its advocates to keep up their momentum. For Hershey, the retreat in Sitka solidified the concrete changes she wants to see in Yakutat.

“I just want to be able to show the community with these small stepping stones we can do these type of things together and then they can take the knowledge that they gain from a chicken coop or community garden and do their own chicken coop or garden,” Hershey said.

The partnership meets throughout the year to continue to brainstorm and work on projects in its communities.

The cities of Kake, Angoon, Pelican, Tenakee Springs, and Port Alexander held municipal elections yesterday (10-06-15). Voters weighed in on city councils, school boards, and a wide variety of propositions (Flickr photo/Daniel Cornwall)

UPDATED 6 p.m., 10-07-15:

Unofficial election result came in from around the region last night (10-06-15) and today (10-07-15). Though the winners aren’t official, this is where the numbers stand now for Kake, Angoon, Pelican, Tenakee Springs, and Port Alexander. 

In Kake, Christine Bitterman earned a handful more votes than incumbent Henrich Kadake Sr. for mayor, 79 to 73. Lloyd Davis and Paulette Jackson won back their two seats on City Council. Isabel Mills and Adam Davis did the same for their two seats on the school board.

Kake also had a proposition on the ballot, asking if the city should allow alcohol to be sold at municipally operated beverage dispensaries and licensed restaurants and eating places. According to City Administrator Rudy Bean, the proposition was voted down “overwhelmingly.”

In Angoon, the top vote-getters for three seats on city council were Jesse Daniels with 43 votes, Pauline Jim with 32 votes, and Randall Gamble with 56 votes. The city also voted NO to adopting a manager form of government. 87 regular ballots were cast, which is a little under 25 percent of registered voters in Angoon.

In Pelican, the two open seats on city council went to Walt Weller and Steve Young with 38 and 35 votes respectively. The three seats on the school board went to Tracee Harrington, Cheryl Young, and write-in Kelly Chapman. Residents also voted “Yes” to recalling Gerald Foss from the position of Council Member by 28 votes. There were 18 “No” votes. All told, 57 regular ballots were cast.

In Tenakee Springs, the four city council seats went to John Wisenbaugh  with 40, Don Pegues with 38, Charles King with 35, and write-in Rudy Ziel with 24.  Tenakee Springs voted “Yes” on the proposition to sell two lots in the townsite for competitive bidding.

And in Port Alexander, a blank ticket produced twenty five write-in candidates for city council. For seven seats, the top vote getters were Cory Gifford and Tommy Corso with 20 votes each, Ryan Martin and Bud Durdle with 16 votes each, Ryan Mulligan with 15, Debra Gifford with 12, and Bill Leudke with 8 votes. 20 regular ballots were cast.

All the villages still have absentee ballots to count before official winners are declared. KCAW will provide an update on village elections early next week.