Danielle N.
Duration: 1 minute
Published on October 21, 2020
We always strive to provide safe, reliable services at competitive rates. Because we are a non-profit organization, our focus is on you, not generating dividends. Rates are set only high enough to cover the cost to provide service. There are no profits that go to shareholders in another city.
This fall, an increase in fuel prices is affecting utilities nationwide. In the U.S., natural gas prices have significantly increased this year. In mid-October 2020, prices were close to a two-year high. Following several years of abundant natural gas supply, 2020 brought a decrease in production related to the pandemic.
Also impacting fuel prices this year are the economic impacts resulting from the Russia-Saudi Arabia oil price war. It drove oil prices sharply down in the spring and lead to lower domestic oil and associated gas production.
As a result of these factors, the electric and natural gas cost adjustments are expected to increase on November 1. If approved at City Council on October 27, the bill impacts are:
- Residential sample bill increases $11.35 (5%) per month.
- Commercial sample bill increases $194.60 (14.6%) per month.
- Industrial sample bill increases $3,544 (8.9%) per month.
We pass through changes in fuel costs to our customers - usually on a quarterly basis. The current proposed adjustment is part of this regular cycle. And, we've had two decreases to the electric cost adjustment and gas cost adjustment earlier this year.
Our base rates support the operations and maintenance expenditures necessary to continue to provide safe and reliable utility services. City Council will vote on the 2021 Rate Case on November 10. If approved, the new rates will take effect Jan. 1, 2021.
For the first time since 2014, we’re proposing a slight increase to natural gas base rates for natural gas pipeline upgrades. We are proposing the following natural gas rate increases.
- Residential sample bill increases $0.22 (0.1%) per month.
- Commercial sample bill increases $21.08 (1.6%) per month.
- Industrial sample bill increases $210.80 (0.5%) per month.
We are proactively identifying any deficient materials and are taking these out of our system and upgrading them. We are currently replacing about 14,000 steel service lines with polyethylene plastic service to take our gas system to the highest standard of reliability.
The result will be better, more efficient and reliable pipes in place for the benefit and safety of all our customers. Our online bill calculator is the best source of information on commercial and industrial impacts, as rate class, load factor and consumption are all contributing factors.
We know this is a difficult time to pass this increase. We care about our customers and have a variety of ways to help with our customer assistance programs.
