The latest proposed increase was anticipated. When rates rose in April, Logan told the council that another increase was expected for January 2012.
The Powell City Council has approved the rate increase ordinance on two readings. Councilmen will consider the final reading Monday night during their regular meeting.
Based on average residential energy usage of 620 kilowatt hours per month, the average increase amounts to $8.13 per month, Logan said in an email to the Tribune. The base meter charge of $18 per month stays the same.
Even with the proposed increase, Logan said Powell’s electric rates still will be competitive with other power companies in the area. Many utility companies in the region as well as across the nation are facing rate increases, he said.
“It’s happening all over ... we’re all in the same boat, unfortunately,” Logan said.
When the increase was first proposed last month, Councilman John Wetzel asked why wholesale rates — and in turn, Powell users’ rates — have increased over the past few years.
“It’s just the combination of a lot of things,” Logan said.
Like many companies and organizations, the Wyoming Municipal Power Agency is struggling with very low return rates on investments in a stagnant national economy.
“They’re just not getting anything back on investments,” Logan said.
The power agency also has been anticipating the Dry Fork Station coming on line. Located just outside Gillette, the coal-based electric plant owned by Basin Electric Power Cooperative and the Wyoming Municipal Power Agency began producing commercial power on Nov. 1. A ribbon-cutting ceremony took place in August.
Following January’s increase, Logan said rates should stabilize with the Dry Fork Station on line.
“There’s a huge upfront cost, and we knew rates would spike,” Logan said. “But with Dry Fork up and running, we’ll enjoy some of the lowest wholesale rates in the nation.”
The Wyoming Municipal Power Agency board members have worked toward the additional power source for the past decade. Logan said the Dry Fork Station will provide a long-term resource for energy for the agency’s eight member towns.
“The bottom line is that this gives us stable, reliable and reasonably-cost power for the next 40 years,” Logan told the Tribune.
Other towns that are part of the Wyoming Municipal Power Agency also are looking at passing along the wholesale increase to customers. The agency includes Powell, Cody, Wheatland, Lusk, Guernsey, Pine Bluffs, Lingle and Fort Laramie.
The city of Cody is looking at increasing its rates on Feb. 1. If approved, small commercial customers will pay 5 to 6 percent more for electricity, large commercial businesses 28.11 percent more, and residential customers 7.14 percent more, or about $5 per month, said city of Cody Administrator Jenni Rosencranse. The Cody City Council will conduct its second of three readings on Tuesday, Dec. 20.
Yellowstone Regional Airport members discussed that increase Wednesday morning during their monthly meeting.
Airport Manager Bob Hooper asked Bert Pond, city of Cody electrical engineer, what the airport should expect. Pond said the terminal’s estimated increase would be $7,166 per year.
Cody City Councilman Bryan Edwards estimated the electric bill for his own business would increase 28 percent next year.
“This one is going to be tough to swallow,” Edwards said.
Meanwhile, Rocky Mountain Power also is seeking a electrical rate increase. That utility’s rate increase would be 10.4 percent overall, ranging from an average 8.8 percent for residential customers to 12.5 percent for some large industrial users, according to the Associated Press. Rocky Mountain Power is Wyoming’s largest electricity provider with about 134,000 customers, including some rural residences in the Big Horn Basin.
For an average Wyoming residential customer, the utility’s increase would mean a $6-per-month increase.
The Casper Star-Tribune reported Saturday that Rocky Mountain Power is asking the Wyoming Public Service Commission for an increase totaling $62.8 million.
The utility filed the application less than three months after a $45 million rate increase went into effect Sept. 22. That increase also raised the typical residential bill by $6 a month.
(Tribune staff writer Gib Mathers and the Associated Press also contributed to this article.)