Declining energy sales prompt 9 HEA layoffs

  • By Rashah McChesney
  • Wednesday, May 20, 2015 5:41pm
  • NewsBusiness

Nine people were laid off from positions within the Homer Electric Association last week.

Their departure represents about $1 million in savings for the company which has seen declining energy sales for the past several years.

In 2012, the company sold 490,000 megawatt hours — a megawatt is about one million watts — and by 2014 that number had fallen to 465,000, according to a media release the company sent out on Sunday.

Company spokesperson Joe Gallagher said the decline could be due to a number of factors, including the rise of more energy efficient light bulbs and appliances.

“People are much more aware of conservation,” he said.

While that awareness is a good thing, he said, when combined with the unseasonably warm winters that the Kenai Peninsula has experienced since 2012 the decline in energy use and sales has caused a drop in revenue for the cooperative.

The company brought in nearly $1 million less in revenue during the first three months of 2015 than it had projected, according to the release.

“The decision to eliminate the positions was extremely difficult, particularly because of the impact it would have on valuable, hard-working employees whose efforts have not gone unnoticed.  It is anticipated these reductions will provide HEA with the financial stability we need at this time,” HEA General Manager Brad Janorschke said. 

Customers may notice the impact of fewer staff members at HEA with longer wait times on telephone calls or longer lines in the company’s building lobby, Gallagher said, but the company is hoping minimize the effect the layoffs will have.

It is not yet clear if energy sales will continue to decline, Gallagher said, but that the company did not have immediate plans to reduce its workforce again.

“We hope that what we’ve just done will be sufficient,” he said.

Rashah McChesney is the city editor  at the Peninsula Clarion. She can be reached at rashah.mcchesney@peninsulaclarion.com or follow her on Twitter @Litmuslens.

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