City Council raises retail power rates

Published 10:41 am Wednesday, July 16, 2008

By Staff
Increase begins Aug. 1;
outdoor, rental lighting
rates also given a boost
Contributing Editor
Washington Electric Utilities’ retail rates will increase by 1.189 cents per kilowatt hour, effective Aug. 1.
Washington’s City Council voted 4-1 to raise the rates. Council members Richard Brooks, Gil Davis, Darwin Woolard and Archie Jennings voted for the increase. Mayor Pro Tempore Doug Mercer voted against it.
The increase approved by the council means the average residential power customer, who had been paying 12.57 cents per kilowatt hour for electricity, will pay 13.759 cents per kilowatt hour.
During a presentation to the council. WEU Director Keith Hardt told the council the increase is needed to recover the wholesale increase from the North Carolina Eastern Municipal Power Agency from which the city buys its power. In late June, NCEMPA’s rate committee recommended to the ElectriCities Board of Directors that NCEMPA’s energy-adjustment rider be increased to 1.120 cents per kilowatt hour. ElectriCities is a nonprofit service organization representing cities, towns and universities that own electric distribution systems. ElectriCities represents more than 90 members in North Carolina, South Carolina and Virginia.
During Hardt’s presentation, council members and Mayor Judy Meier Jennette discussed two options presented by Hardt. They talked about finding the most equitable way to distribute the increase in power rates among the various retail rate classes — residential service, small general service, medium general service, large general service, industrial service and outdoor lighting.
During his presentation about the first option (increasing retail rates by 1.189 cents per kilowatt hour), Hardt discussed the following information:
Hardt’s review of the second option (increasing all retail-rate determinants charged by Washington Electric Utilities by 10.33 percent) included the following information:
Under the second option, the average residential customer would pay 1.299 cents more per kilowatt hour.
The increase in what the city pays for power means the city’s wholesale expenses for power will increase approximately $3,426,317 or 13.8 percent for this fiscal year, according to Hardt.
The council also increased the retail rate charged to medium general-service customers by 1.4 percent, effective Aug. 1. A cost-of-service study presented to the council in February indicated this retail rate class was not being charged enough to cover cost of service to customers in the rate class.
The council also increased the retail rates charged for rental outdoor lighting service and street lighting service by 14.9 percent, effective Aug. 1. The cost-of-service study determined existing charges for the services do not cover costs for providing those services.
For addtional coverage of the council’s meeting, see future editions of the Washington Daily News.