Golden Valley Electric Association: Interior utility looks to propane, natural gas, coal.

• Author: Kalytiak, Tracy
• Position: 2009 Alaska's Top 49ers: TRAILBLAZERS leading the state's top business

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Challenges have loomed in recent years for Golden Valley Electric Association, thanks to ballooning energy costs, brisk growth in the Fairbanks area, and the fact that GVEA is the only Railbelt utility that primarily burns oil to produce electricity.

The company, ranked 15th among Alaska Business Monthly's Top 49 revenue earners, has long tried to educate its nearly 100,000 customers about the importance of conservation and the relationship between oil prices and the size of electric bills. GVEA ramped up those efforts last year when oil prices veered to a nightmarish $147.27 a barrel.

"It's been ongoing," Golden Valley President and CEO Brian Newton says of the 249-employee company's current "U First" and "Kick the Oil Habit" outreach efforts, accomplished via television, radio, bill inserts, public meetings and the company's Web site. "We always want people to use electricity wisely. When it's cheap, a lot of people take it for granted. When oil prices jumped up, the electric bill became the second or third largest each month."

Newton believes the push to empower Golden Valley's consumers is working.

"I think it's resonating fairly well," he said. "We're getting positive feedback."

COST OF DOING BUSINESS

The cost of fuel has a huge impact on the bottom line at GVEA. The company earned $196 million in revenue in 2007, and last year its revenue increased 9.2 percent to $214 million.

Most of that money was spent on generating and purchasing electricity, said Mike Wright, GVEA's vice president of transmission and distribution. In 2007, fuel costs totaled $133 million and last year, fuel costs totaled $150 million.

"The rest was to cover distribution and transmission," Wright said. "Our cost of power is significantly higher than anyone else in the state on the Railbelt; Copper Valley's cost might be a bit higher."

Demand for electricity has grown in GVEA's service area, which extends from Cantwell north along the Parks Highway and from Fairbanks south to Fort Greely along the Richardson Highway, The peak load for the utility's electricity hovers around 220 megawatts a year, according to the coop's 2008 annual report.

Growth in the Fairbanks area squeezed the power supply until 2007, but slackened last year. The number of new connections was 1,045 in 2007, Wright said, falling to 594 in 2008. By late August, GVEA had made 186 new electrical connections this year.

The total value of the utility's physical structures was...