Water and Light Commission talks rate increase
WORTHINGTON — The Worthington Public Utilities Water and Light Commission heard it will have to figure out how to cover an approximately $1.4 million rate increase it is facing next year.
During the regular meeting Monday afternoon, Public Utilities General Manager Scott Hain said Missouri Energy Services is increasing the cost of power for the city of Worthington.
The total increase is approximately $1.43 million, which left the commission trying to figure out the best way to cover those costs.
“We should be charging what we’re facing as an increase,” commission member Randy Thompson said.
Of those extra expenses, more than $700,000 of that is from transmission costs.
“There is absolutely no need for a rate increase attributed to local costs,” Hain said. “The increase needed due to the power cost adjustment, which is purchase power and transmission impact, is 6.3 percent.”
No official action was taken during the meeting, with the commission members wanting to see some numbers before making a final decision.
One of the scenarios had residential increasing 7.6 percent, small commercial 5.5 percent, large commercial 6.5 percent and industrial 4.8 percent.
The WPU has a fund in reserve for rate stabilization. However, within the discussion, the commission didn’t seem too willing to dip into the $750,000 reserve.
In fact, Hain said that reserve should actually be increased —if not doubled.
Hain also described a billing cycle where the rates would be different depending on the months. There would be a rate for the months of summer, those in the winter and all the rest. This also lines up with the way WPU is charged for the energy it purchases from Missouri River Energy Services.
Before talking about a potential rate increase, the commission heard results from the Owatonna Public Utilities electrical and water rate comparison study.
Within the electric side, the city was either the lowest or very close to the lowest of all those surveyed. That included towns like St. Peter, New Ulm and Fairmont as well as some of the larger energy companies like Xcel.
The first item of business for the commission was the water levels within Worthington. As it has been for the past few months, those levels show a ban on non-essential water use is likely on Nov. 1.
“We are 4.38 feet below the 15-year average,” Hain said. “We are 6.17 feet above 70 percent of the average, so we’re still better than halfway between those two marks.”
On a bright spot, the wells are 4.5 feet better than they were a year ago. Total water sales year to date compared to last year are down 7.1 percent. However, the draw out of the Lake Bella well field is 23.5 percent less this year. Purchased water from Lincoln-Pipestone Rural Water has made up the difference.
There will a well reading this week and on Nov. 1 as well.
“Are we going to make up 4.38 feet in two weeks? Absolutely not,” Hain said.