Public Utility District approves rate increases
In their 2001 budget, the Truckee-Donner Public Utility District will implement rate increases on both water and power bills, as a result of the rising cost of purchasing power. The board approved the new budget at its Dec. 6 meeting.
In the first electric rate hike since the mid-1980s, the Truckee-Donner PUD was forced to take away the 11 percent rate discount to power customers due to increasing costs of power from Idaho Power Company and the volatility of the electric industry in general.
In previous years, the district enjoyed a low-cost power contract with Idaho Power. That contract is going up as power continues to be in increased demand in the Western United States.
“The biggest factor in our budget is the purchase of power,” TDPUD General Manager Peter Holzmeister said. “That is the entire increase in the budget.”
While the ratepayers will pay for approximately $1.1 million of the total $1.5 million increase in purchased power costs, the district is absorbing the approximate $400,000 difference.
“Other utilities throughout the state are facing cost increases in a much more severe manner,” Holzmeister said. “The good news is that our rates are still highly competitive with surrounding utilities. The customers of TDPUD truly enjoy some of the lowest electric rates in California and Nevada.”
Only two other utilities in California have lower rates than the Truckee-Donner PUD.
The 2001 electric budget projects expenditures of $9,960,304 and revenues of $10,418,773. The district will add $100,000 into its Rate Stabilization Fund, resulting in $358,465 available for capital investment.
The Rate Stabilization Fund will be used as a cushion for an unpredictable electric industry.
“We are so unsure about what’s going to happen in 2002 that we want a cushion for our rates,” Holzmeister said.
Higher electricity rates are the reason the water rate will increase by 5 percent, or $2.06 per month per bill, Holzmeister said.
“The biggest increase on our water budget is the cost of power we use to operate water pumps,” he said.
The water budget projects expenditures for 2001 of $4,276,996 and revenues of $4,557,658 with $280,661 being available for capital improvement.
Over the past several years, the district has incurred considerable debt to replace portions of the water system that were failing and to expand the capacity of the water system to meet the needs of new customers. One of the highest items on the water budget is the payment of principal and interest to service that debt, which is 29 percent of the entire operating budget.
The water budget provides funding for the development of a new well and the associated transmission main. It is essential that a new well be brought on line before summer 2001, said district staff.
Neither the possibility for the district to offer broadband services to its customers or the acquisition of Donner Lake water were included in the 2001 budget. Supplemental budgets will be prepared if those issues come to pass.
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