Otis Singleton
Alaska has a regulated electricity market, with 55 electricity suppliers offering a variety of rates for residential customers. The average residential electric bill in Alaska is $142.61 per month, with rates varying by electricity consumption, fuel costs, and allowable Power Cost Equalization (PCE) adjustments. While Alaska is not the most expensive state for electricity, ranking 47th lowest, it does have the 47th highest non-renewable energy generation. Net metering policies in Alaska can help residents with solar panels save money and reduce their carbon footprint. Additionally, the state offers various programs to assist residents with utility bills, such as the General Relief Assistance program and the Alaska Temporary Assistance Program.
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What You'll Learn
Sources of electricity generation in Alaska
Alaska is home to 143 electricity-producing plants, which is the 26th highest in the country and most per person. Natural gas is the most commonly used fuel type for electricity generation in the state, accounting for 43.68% of the total fuel mix. The state also has a significant presence of conventional hydroelectric power, contributing 26.95% to the electricity generation portfolio, with coal as the third most used fuel source at 11.66%.
The state's ranking in renewable electricity generation per capita is 20th in the nation, with 2.65 megawatt-hours per person annually. Alaska has witnessed a substantial increase in electricity generation from solar fields, with a remarkable 34718.44% growth in the past year, translating to an additional 15,970.48 megawatt-hours each year.
The Railbelt region, with its six utilities, is a key area for power generation, boasting approximately 2,000 MW of installed capacity. The Eklutna Lake hydropower plant, developed in the 1940s, and the discovery of oil and gas in the Cook Inlet region in the 1960s, have historically provided relatively low-cost heating and power to the Anchorage and Matanuska-Susitna Valley areas. The completion of the Willow-Healy Intertie transmission line in 1986 further diversified energy sources for the Fairbanks area.
Southcentral Alaska relies almost entirely on natural gas supplied by ENSTAR Natural Gas Company, which transports gas from the Cook Inlet gas fields. Additionally, the state has been working to improve power generation efficiency and develop local renewable energy sources, such as wind, biomass, and hydropower.
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Average electricity bills in Alaska
The average residential electricity bill in Alaska is $142.61 per month, making it the 32nd most expensive state in the country for electricity. The residential electric rates are highest in August, and the highest average bill is in January. The average Alaska consumer uses 8.31 megawatt hours of electricity annually, which ranks the state as the 42nd highest for electricity use per person.
The residential electricity rate in Alaska for 2025 is 24.71 cents per kilowatt hour, while the national average price is 16.52 cents. This makes Alaska the 47th lowest-priced state in the US based on average electric rates. The state's electricity is predominantly generated using natural gas (43.68%), followed by conventional hydroelectric power (26.95%), and coal (11.66%).
Alaska has a regulated electricity market, and consumers have limited choices in their electricity supplier, which is determined by their home address. The state has 143 electricity-producing plants, the highest number per person in the country.
The electricity bill in Alaska can vary based on factors such as the amount of electricity consumed and the cost of fuel for the community. Some communities also assess city sales tax on electrical usage, and there may be additional charges for demand meters. Alaska has a relatively high number of outages, with an average of 2.26 outages per year, lasting 264.68 minutes each, compared to the national average of 1.44 outages lasting 123.49 minutes each.
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Net metering policies to save money
Net metering is an electric billing tool that allows customers to offset their energy use and transfer energy back to their electric companies in exchange for a bill credit. It is a policy that has incentivized many people to invest in renewable energy generation systems. Net metering ensures that every kilowatt-hour (kWh) of energy a homeowner's solar panels produce goes toward reducing their utility bills by the same amount.
There are a few different net metering alternatives in place in the U.S., including net billing, feed-in tariffs, and buy-all, sell-all. For example, under net billing, solar energy that is used to power a home’s appliances directly reduces the homeowner’s electric bill by the full retail cost of electricity, but energy that is sent to the grid is credited at a lower rate. The monetary credits are then applied toward the customer’s bill.
Net metering credits never expire and will roll over to the next billing period unless the facility is a cap-exempt facility serving on-site loads. If a customer's net consumption is positive, they must pay an electricity bill for the excess consumption at the end of the billing period. If their net consumption is negative, they will receive a net metering credit on their bill and will not owe the electric company money during that billing period.
Net metering is not the only way utilities compensate homeowners for going solar, but it is the most common and effective solar policy at the moment. It is available in some states, including Alaska, where 10 out of 55 electricity suppliers offer net metering.
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Assistance programs for utility bills
While Alaska is not the most expensive state in the US for electricity, the average monthly electric bill of $142.61 can still be a significant burden for low- to middle-income families. Utility assistance programs are therefore crucial for many Alaskans, providing a safety net for those struggling financially and preventing utility shut-offs.
The City of Anchorage, for example, offers various utility assistance programs for its residents, including the federally funded Low-Income Home Energy Assistance Program (LIHEAP). This program assists eligible low-income households with their energy bills. Many utility assistance programs in Anchorage also include initiatives aimed at improving energy efficiency in homes, such as weatherization assistance services, energy audits, and insulation upgrades. These measures not only help families reduce their energy consumption but also lower their utility bills in the long run.
In addition to city-specific programs, Alaska has a statewide 211 line that can make referrals for Alaskans who need help paying their utility bills. United Way data from 2023 suggests that utility assistance is one of the top four unmet needs in the state, along with requests for help with housing, transportation, and food. To address this, the agency has a database of around 70 partners, including nonprofits, city and state programs, and tribal and non-tribal entities, that can provide some form of energy assistance. The database also keeps track of which programs are currently accepting clients and have funding available.
Alaskans seeking utility assistance can also benefit from federal funds that are available in all states to help subsidize electric and heating bills. EnergyAssistance.us, for instance, provides listings of energy assistance programs sponsored by local governments and nonprofit organizations in various cities across Alaska. These programs are designed to assist low-income individuals and families with their utility bills.
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Electricity rates for residential customers
Alaska has a regulated electricity market based on residents' home addresses, which means consumers have little choice in their electricity company. The average residential electricity rate in Alaska is 17.88 cents per kilowatt-hour, ranking it as the 47th lowest-priced state in the US. The national average price is 16.52 cents per kilowatt-hour.
The average monthly residential electricity bill in Alaska is $117, ranking 15th in the US. This is 9.35% greater than the national average monthly bill of $107. The average residential electric bill in Alaska is also reported to be $142.61 per month, which would make Alaska the 32nd most expensive state in the country for electricity. Residential electricity rates in Alaska average 17.88 cents per kilowatt-hour, which ranks the state second in the nation. The average residential electricity rate of 17.88 cents per kilowatt-hour in Alaska is 50.51% greater than the national average residential rate of 11.88 cents per kilowatt-hour.
Electricity consumption by Alaska residents averages 654 kilowatt-hours per month, ranking 43rd in the nation. The average Alaska consumer uses 8.31 megawatt-hours of electricity each year, which ranks the state as the 42nd highest state for electricity use per person. The state has 143 electricity-producing plants, the 26th highest in the country, and most when counting plants per person. Power-generating facilities in the state most often use natural gas, which makes up 43.68% of the fuel types used for electricity generation. Secondary fuels used during electricity generation include conventional hydroelectric power at 26.95% and coal at 11.66% of generation.
The rate charged to residential customers varies by the amount of electricity consumed, the cost of fuel for the community, and the allowable Power Cost Equalization (PCE) adjustment approved for the community. The PCE is governed by Alaska State Statute (42.45.110), and rates are approved by the Regulatory Commission of Alaska. Some communities assess city sales tax on electrical usage. If a service is billed on a demand meter, there will be a demand charge assessed, which is derived from the highest draw from the generator during a 15-minute interval throughout the month.
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Frequently asked questions
No, Alaska does not pay you for your electricity. However, Alaska has net metering policies that allow solar panel owners to save money by sending excess electricity back to the grid and receiving credit on their next bill.
The average residential electric bill in Alaska is $142.61 per month, with rates of 24.71 cents per kilowatt-hour. Alaska is the 32nd most expensive state in the country for electricity.
Yes, the DHSS has several programs to assist Alaskans with utility bills, including the General Relief Assistance program and the Alaska Temporary Assistance Program. Additionally, the Senior Benefits program provides monthly cash payments of up to $250 for Alaskans aged 65 or older.
