Title
AN ORDINANCE AMENDING SECTION 1048.02, "RATE SCHEDULES," OF THE STREETS, UTILITIES AND PUBLIC SERVICES CODE TO ADOPT ADJUSTMENTS TO THE ELECTRIC POWER SUPPLY COST ADJUSTMENT FACTOR IN THE SCHEDULE OF CHARGES.
Brief Description: The City's Public Works Department has completed the electric rate and cost of service study with Power Consultants Courtney & Associates. The consulting firm presented the study's results to City Council on July 13th and recommended a 5.1% adjustment to the Power Supply Cost Adjustment Factor (PSCAF) formula. Staff is recommending City Council implement the adjustments in conjunction with the January 2022 billing cycle.
Body
Legislative History
Ordinance Nos. 15-58 (passed 5/19/2015) & 15-125 (passed 9/1/2015); Electric Rate Structure Amendments.
Purpose & Explanation
The 2020 -21 HPP rate and cost of service study, which analyzed Hudson Public Power's cost of services including power supply, indicated that the current rates will not sustain the costs of services or debt coverage moving forward. The calculated shortfall is 5.1%. for the period 2021-2025. The breakdown of the 5.1% is 1.4% in system and unbilled losses, and 3.7% in operating and maintenance projections looking out to 2025. The portion accounting for unbilled losses is the result of a 2% reduction in kWh sales from 2014 to 2021. The primary drivers were the loss of a large HPP customer and reductions in kWh by the City's "E" Rate customer. For the 3.7% in operating and maintenance projections, the consultant used the historical HPP data through 2020. The Consultant has recommended the 5.1% shortfall be recovered through the power supply cost adjustment factor (PSCAF) component of the City's rate structure.
The projected impact on HPP residential electric bills @ 1000 /kWh /month with the current recommendation:
* 2021- $132
* 2022 -$138
* 2023 -$137
* 2024 -$137
* 2025 -$135
(Note: fluctuations are the result of projected power costs)
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