PORT ANGELES — A city increase in electrical charges is fueled by a need to continue rebuilding reserves depleted by the 2000-2001 West Coast energy crisis, says City Power Resources Manager Larry Dunbar.
The City Council approved a rate increase this week that will raise the average residential monthly bill by 5.9 percent.
“We were using reserves to balance the budget through 2005 and starting rebuilding them in 2006,” Dunbar said of the electric utility that expected to receive $30.8 million in revenues this year.
“It’s going to take five years because it’s a lot of money.”
The city’s target for its rate stabilization fund is $3.5 million.
It is projected to be $2.1 million by the end of 2007 and $2.5 million by the end of 2008, Dunbar said.
The energy charge, which is based upon usage, will increase from 5.45 cents per kilowatt-hour to 5.84 cents.
The $11 monthly charge will remain the same.
The city electrical service is the only power available within the city limit.
The city increased electricity rates by 19.5 percent in 2001, 5.7 percent in 2003 and 6.5 percent in 2005.
It also used about $5 million from that rate stabilization fund during 2001-2004, including $1.8 million in 2003-2004, to keep electricity rates down.
“It was built up over several years,” Dunbar said.
“We were very thankful we had that available to get us through those tough times.”
Other factors
Other factors include two years of cost of living increases, two years of inflation and some mild weather that reduced revenue from the residential rate class, Dunbar said.
“We actually had a mild February and March,” he said.
The expense of replacing housing for the utility after the City Light building at 240 W. Front St. was sold to Family Medicine of Port Angeles is a factor in the increase, but not a large one, Dunbar said.
How the city will replace that building — buying or leasing long-term — has yet to be decided, he said.
Whatever the decision, it won’t affect electricity rates greatly, he said.
The rate increases will cost about $5.85 per month more for residential customers, $9.20 per month for small commercial customers, $65 per month for larger commercial customers and $1,575 per month for the largest commercial customers.
The monthly bill for residential customers using 1,500 kilowatt-hours a month would increase by $5.85 from $92.75 to $98.60.
Small commercial customers would see their energy charge increase from 5.48 cents per kilowatt-hour to 5.87 cents.
So a small commercial customer using 2,350 kilowatt-hours per month would see a $9.20 increase in the monthly electricity bill.
The larger general service demand customers would see their energy charge increase from 3.62 cents per kilowatt-hour to 3.88 cents.
So a general service demand customer using 25,000 kilowatt-hours a month would see a $65 monthly electricity bill increase.
The largest primary service customers would see the energy charge increase by .26 cent per kilowatt-hour in the winter and by .16 cent per kilowatt-hour in the summer.
So those customers would see an estimated $1,575 increase in their monthly electricity bills, based upon 750,000 kilowatt-hours.
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Reporter Brian Gawley can be reached at 360-417-3532 or brian.gawley@peninsuladailynews.com.
