Residents in the northern Southeast Alaska town pay some of the highest utility bills in Alaska - recently as high as 51 cents per kilowatt hour - in part because of the Gustavus Electric Co.'s dependence on expensive diesel fuel.
The hydro project cannot begin until Glacier Bay National Park allocates about 404.7ha to Alaska from the wilderness area along Falls Creek, the proposed site of the project.
Wilderness advocates in Alaska and the Lower 48 claim the Falls Creek project will set a bad precedent for wilderness protection throughout the country. They also question the economics of the project.
In FERC's order, the commissioners rejected the Sierra Club's and the Hoonah Indian Association's assertions that the project would damage the national park and adjacent Native-owned lands. They noted that fewer than 150 people visit the Falls Creek area per year. The commissioners also vetoed a recommendation from state and federal resource agencies to increase the project's minimum flows on Falls Creek on behalf of its Dolly Varden trout, which would have cost the company some generating capacity.
