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PUD approves rate increase

Erich Sommer, Sierra Sun

With wildly fluctuating energy bills, corporate bankruptcies and periodic blackouts throughout much of the state serving as a backdrop, the Truckee Donner Public Utility District’s first retail electrical rate increase since 1986 is barely raising an eyebrow.

In fact, with TDPUD locked into a long-term contract with Idaho Power that will provide “reliability and stability,” rarely has a fee increase been so well received, district officials say.

“Out of 11,000 letters (sent to TDPUD customers), we got two E-mails and (General Manager) Peter (Holzmeister) got one phone call. And all three of the replies were favorable,” said TDPUD board of directors president Jim Maass.

“People either expected it to happen, or people are taking it in stride,” he said afterward.

Prior to the board’s 5-0 vote to raise rates, Assistant Manager Steve Hollabaugh went over a report that outlines the district’s increased wholesale costs for power.

According to the report, the wholesale rate TDPUD currently pays will increase from 4.60 cents per kilowatt hour to 7.05 in 2002 and 8.25 in 2003.

The current residential retail electric rate charged by TDPUD is 6.81 cents per kw/hr. To cover the increases in wholesale costs, TDPUD will raise electrical rates to 9.26 cents kw/hr in January, and to 10.46 cents in 2003.

Hollabaugh then presented two options to the board for covering the fee increases.

The first plan split the rate hike of 2.45 cents kw/hr over the next six months.

Under this plan, the report states, “The typical residential monthly electric bill for a customer using 650 kw/hr would increase from about $48.27 to $56.24 in August and $64.21 in January 2002.”

The second option consisted of a single rate hike in January. The board unanimously voted for the first option.

Hollabaugh, Holzmeister and Maass all pointed out that TDPUD’s rate hike equates with the increased prices the district is paying for power.

“The rate increase is a pass through,” Maass said, also noting the district’s operating costs remain the same.

Hollabaugh’s report states the district will need to implement another rate hike by January 2003 to cover rising wholesale costs.

After 2003, the contracted wholesale prices remains static at 8.25 cents per kw/hr, with TDPUD retail rates also remaining fixed at 10.46 cents through 2009.

Afterward, Maass noted that even with the increases over the next two years, TDPUD customers will be paying nowhere near what others are paying.

“Right now, I think Pacific Gas and Electric rate is around 22 cents a kilowatt hour,” he said. “Even after (the rate increase), we will still have the fifth or sixth lowest rates in the state.”

Hollabaugh cited stability and a transmission system outside of California as side benefits of the contract with Idaho Power.

“The reliability is excellent,” Hollabaugh said. “We are not on the ISO (independent system operator) in California. We are on Sierra Pacific’s transmission lines.”

“We are looking at very stable prices for the next few years,” Maass said. “But, we always encourage conservation.”


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