Healy Lake and Chisana - Alaska Power and Telephone Company

AP&T
ALASKA POWER COMPANY
ALASKA TELEPHONE COMPANY
Application to Abandon Service in Healy Lake and Chisana –
Dockets U-12-91 and U-12-92
Michael Garrett – Executive Vice President
Thomas Ervin – Vice President – AP&T Board of Directors
John Harvey – Manager - Interior Power Operations
Jason Sanford – Manager – Interior Telephone Operations
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AP&T Company Overview
• Alaska Power
Company (APC)
serves 21 communities
• Alaska Telephone
Company (ATC)
serves 20 communities
• APC and ATC are
wholly owned
subsidiaries of Alaska
Power & Telephone
(AP&T)

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AP&T Company Overview
• AP&T is employee owned.
• Energy affiliates include Goat Lake Hydro and Black Bear Lake
Hydro.
• Approximately 70% of AP&T energy comes from renewables,
specifically hydro. AP&T continues to investigate, kinetic energy,
wind, biomass and LNG.
• AP&T provides broadband to approximately 96% of its customers at
speeds up to 8mb down / 1mb up at rates comparable to urban areas.
• AP&T offers wireless broadband service to areas not served by the
ILEC (Northway, Klawock, Thorne Bay and Kassan.
• AP&T provides competitive long distance voice services via resale to
customers inside and outside its exchange.
• AP&T has built extensive middle mile facilities in Southeast Alaska
using microwave Ethernet technology.

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What is AP&T Requesting?
• Healy Lake, Alaska
• AP&T’s energy and telecom affiliates are requesting to abandon
service in this location because of the minimal energy demand and
the low number of residents in the area. These factors have
changed dramatically since service was established. AP&T asserts
that the current and future outlook for the area no longer meets the
public interest standard.
• Chisana, Alaska
• ATC requests to abandon wireline telephone service in Chisana for
two reasons. The reasons are; local power issues have effected
service reliability and the solution to the energy issue would require
significant investment. In addition, a significant drop in the local
year-round population bring into doubt continued telecom service
from a public interest perspective.

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Healy Lake - Establishment of Utility
Service
• Telephone Service was established in U-94-33 (ATC)
• Power Service was established in U-94-34 (APC)
• APC received a grant to build plant in Healy Lake
• ATC negotiated with TUNI to modify its service area so it could
provide telecom services along with APC
• 10 to 12 homes were to be built if APC / ATC received authority to
provide service
• A new school was built and funded by the State of Alaska
• The goal of the local native organization was to rebuild the community
and bring people back to live permanently. It was reasonable to
expect that the community would grow given the monies invested in
the school and housing.

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Healy Lake Service Area

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Where is Healy Lake, Alaska?
• Located approximately 30 miles from Delta Junction

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Healy Lake

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Healy Lake - School

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Healy Lake - Residents

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Healy Lake – Telecom Site

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Healy Lake – Energy Services
• Energy generated via diesel generators
• Two, gensets (33KW and a 45KW. These most efficient running at
80% capacity or 26KW)
• Originally engineered for peak loads of the community (46KW).
Fuel efficiency was consistently at 12 to 13KwH per gallon
• Site fuel holders have enough for approximately 1.75
years (14,000 capacity, 8,000 used annually for current
load)
• Monthly average load – 3KW
• Fuel is transported to Healy Lake via an ice road in spring

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Healy Lake – Power Plant

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Healy Lake – Power Plant

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Healy Lake – Power Plant

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Healy Lake – Fueling the site

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Healy Lake – Fueling the site

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Healy Lake – Fueling the site

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Healy Lake – Ice Road

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Healy Lake – Telecom Service
• ATC provides traditional wireline service
• No wireline broadband service is available
• Originally some customers across the lake (Murkowski
cabin) were to be served with BETRS
• AT&T Alascom provides facilities based long distance
service via microwave connecting to Delta Junction
• Based on observation, both AT&T Mobility and ACS
(CETC’s in ATC’s study area) have some cellular service.
In this case it seems AT&T has the best coverage.

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Healy Lake – Central Office

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Healy Lake – Central Office

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Healy Lake – What happened?
• The school was built and some homes were built
• In 2006 the school was closed due to lack of enrollment
• Gradually most residents left the community
• Economic conditions and other incentives actually
encouraged residents to move to urban areas
• As usage declines, COPA rates increase making energy
very expensive
• The community is small enough that the value of local
telecom service is minimal and connection outside the
community was valuable
• Technology has changed communications. Cellular was
in its infancy and coverage has increased

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Healy Lake – Current Energy Usage

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Healy Lake – Telecom Customers
• 3 local telecom accounts
• Brian Erickson (watchman)
• Josephine Beaver (at Kirsteatter residence)
• Village Office
• Current Service Quality – Excellent for power and
telephone
• Energy Site Support – A mechanic visits the site monthly
to perform preventative maintenance
• Telecom Site Support – As needed

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Healy Lake – Service Rates
• Energy
• Healy Lake is part of Interior Village Rate Group. This group includes:
• Allakaket and Alatna; Bettles and Evanville; Chistochina; Eagle and
Eagle Village; Mentasta; Northway and Northway Village; Slana
• Energy Rate - $.3391 per KwH and $12.46 customer charge
• COPA Rate $.6804 per KwH, offset by PCE Rate of $.5630
• PCE rate is imputed because this location does not meet the line loss and
efficiency standards (12% for line loss and 9.5KwH per gallon)
• Future Energy Rates – All other issues being equal, due to the high
operating costs per customer and per KwH sold, we would expect the rates
in this rate group to decrease. No estimate has been calculated to date.
• Telecom – Given the multiple jurisdictions in telecom rate making, lower
expenses will have a minimal effect on local rates.

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Healy Lake – If application is approved.
• Energy
• APC proposes to abandon the outside plant in place however
safety and liability is a major concern and it is yet, unresolved.
• If unable to sell generation, fuel holders and other plant at salvage
value, APC would redeploy the equipment in other service areas as
needed.
• Telecom
• Pursuant to 3 AAC 53.230 –ATC filed a plan to assist the customer
in choosing alternate telecom service provider, in this case a
cellular company if they do not already subscribe to cellular
service. ATC would help them connect with a carrier but does not
propose to pay for service.
• Healy Lake’s 876 NXX would be returned to NANPA for
redistribtuion

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Chisana – Establishment of Utility Service
• Telephone Service was established in U-95-43 (ATC)
• Docket U-96-111 resolved the dispute between ATC and
AT&T Alascom related to interconnection. The 25 or more
customer rule was documented in RCA Staff comments.
• ATC had petitions for service from approximately 32
customers.
• ATC acquired permission to bury its cable on private
property and National Park land. ATC maintains a lease
with the National Park service.
• ATC contracted with a local resident who would provide
space and power for ATC’s and AT&T Alascom’s
equipment. ATC subleases space to AT&T Alascom.
• Chisana has no school or other local government

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Where is Chisana?

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Chisana Service Area Map

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Chisana

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Chisana

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Chisana - Service
• No energy service is provided by AP&T
• ATC provides traditional wireline service
• No wireline broadband service is available
• AT&T Alascom provides facilities based long distance
service via satellite
• No CETC’s maintain any services or coverage into
Chisana
• Site Support – As needed

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Chisana – Central Office

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Chisana – Central Office

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Chisana – Earthstation

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Chisana – Smitholum Cabin

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Chisana – McNutt Cabin

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Chisana – What happened?
• Population never grew since service was established
• Over time residents moved to more urban areas and only
a few full time residents remain.
• Energy reliability contracted from local resident
deteriorated. We have no expectation energy will
reliability will improve.
• As energy reliability has deteriorated so has the quality of
local and long distance telephone service

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Chisana – Current Customers
• Telecom
• When testing individual satellite phones the resident population was 7. 2
@ Jones, 2 @ Smitholum and 3 @ Overly’s.
• We currently bill local service to (as of August 2012):
• Dibble (C/O Overly) – full time
• Fiehler – seasonal
• Hall - seasonal
• Jones Family (2 residents) – full time
• McNutt – seasonal
• Miller – seasonal
• Overly (including Pioneer Outfitters) – full time
• Turner – seasonal
• Smitholum (2 residents) – full time
• National Park Service personnel – seasonal and they carry a portable
satellite phone

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Chisana – Service Rates
• ATC local rates are developed on a postage stamp basis
and costs allocated to the local jurisdiction are used to
develop local rates company wide. I do not expect local
rates to change measurably if service is abandoned.
• Other factors will have more of an impact on local rates
like loss of universal service funding which helped support
service in high cost areas.
• Business Rates are $26.55 and residential rates are
$18.30 in all exchanges.
• ATC barely exceeds the CAF / ICC benchmark rate so an
ARC charge will not be added to residential rates.

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Chisana – If the application is approved.
• Pursuant to 3 AAC 53.230 –ATC filed a plan to transfer customers to a
satellite telephone provider. Chisana’s 734 NXX would be returned to
NANPA
• ATC would pay for the initial purchase of the satellite telephone and hardware
for full time residents (one per family). ATC would also pay for 360 minutes
of measured voice service through the satellite provider. Approximate price of
hardware and service is $2,390 without including the cost of installation. ATC
will install the hardware and test it free of charge.
• In return for providing the hardware and minutes, ATC would want each
resident to agree to keep the buried plant in place unless it can be proven to
endanger resident safety or wildlife.
• While ATC’s current land lease with the National Park Service calls for
removal of the buried plant, ATC will negotiate with the agency to ask for a
waiver of this requirement.
• Additionally, the buried plant has value and the residents may want a lowpower
local intercom ability that would utilize the cable. ATC would be willing
to help establish this with a keysystem, however once established it would be
the residents responsibility to maintain the system.

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Chisana – Satellite Service Provider

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Chisana – Satellite Service
• At the time the exchange was established
communications of this type was not available at current
prices
• Individual satellite service is the best solution for small
clusters of customers as is the case in Chisana
• We tested the service and all full time resident locations
were able to acquire satellite signal
• The only cabin not able to get signal was the Miller cabin
(seasonal).