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December 15, 2011 9:30 am

Another electric rate increase considered by city

Written by Tessa Schweigert

For the second time this year, the Powell City Council is considering an electric rate increase.

The city is proposing a 15 percent increase for residential and commercial users. If approved, the increase will show up on January utility bills.

“Our wholesale cost went up 22 percent. This is the minimum we could do,” City Administrator Zane Logan told councilmen.

Wholesale cost increases through the Wyoming Municipal Power Agency have resulted in higher electricity bills for three consecutive years. In April, residents saw a 10 percent hike in their electric fees. Rates increased by 11 percent in 2010 and by 5 percent in 2009.

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.)

4 comments

  • Comment Link December 15, 2011 7:55 pm posted by Rebecca

    I make $9.00 an hour. I am sick of paying for city employees wages and bonuses by raising the already outrageous utility rates they already charge. I have no insurance and can't even pay basic subsistence on my wages. I also am not the only person who lives this way in this town, but the town administrators would rather not acknowledge the problems people have in Powell with basic needs.

  • Comment Link December 16, 2011 8:13 am posted by Disgusted Taxpayer

    One will notice that everything goes up but the wages anymore.Of course we all have to pay for keeping the golf course and swimming pool open somehow.

  • Comment Link December 18, 2011 7:41 am posted by disgusted taxpayer

    Someone has to pay to keep the swimming hole full,and the golf course operating, what's in your wallet?

  • Comment Link December 20, 2011 10:54 pm posted by Tough Times

    "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"
    This quote tells me that the Agency isn't making enough money on their investments so they are raising our rates so they don't have to live within their means like the rest of us have to in this stagnant economy. We the consumer cannot unplug our house from them and find a different outlet to get our power from.

    “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.”
    --- "we knew rates would spike" - With these "spiked rates" they should have their investment paid off in quick order and start making record profits, like all other energy companies" very shortly at the demise of the consumer.

    As for the comments about paying for the golf course and swimming pool, maybe we should get rid of all publicly funded entities in town. I don't use the baseball fields, city parks, I haven't used the fire dept. or the local Emergency room,yet!. I don't use every street light in town nor do I walk on every sidewalk or drive on every street, I guess I do flush my toilet regularly so we might want to fund that, I have NEVER played football on Astro-turf, (How much was that field that very few can use for anything?). . . . see my point.

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