HomeMy WebLinkAboutRes2009-115 Sponsored by: Oates
CITY OF SEWARD, ALASKA
RESOLUTION 2009 -115
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
SEWARD, ALASKA, AMENDING THE ELECTRIC RATES AND
CHARGES TARIFF TO INCLUDE AUTOMATIC ANNUAL
ADJUSTMENTS TO ALL RATES AND FEES BY AN AMOUNT
EQUAL TO THE PREVIOUS FIVE FULL YEARS' AVERAGE
INCREASE IN THE ANCHORAGE CONSUMER PRICE INDEX FOR
ALL URBAN CONSUMERS, AND AUTOMATIC PASS - THROUGH
OF RATE INCREASES FROM CHUGACH ELECTRIC
ASSOCIATION
WIIEREAS, the Seward City Council conducted extensive public rate review work sessions
for thc purpose of addressing critical infrastructure and operational needs of the Electric Utility; and
WHEREAS, the Seward City Council recommends that rates be adjusted to Seward Public
Utilities electric customers effective January 1, 2010, to pass along the October 9, 2009 billed rate
increases from Chugach Electric Association to the City as approved by the Regulatory Commission
of Alaska ( "RCA "); and
WHEREAS, the Council finds that it is in the financial interests of the Electric Utility to
pass along future Chugach rate adjustments to our customers when approved by the RCA; and
heretofore authorizes those rate increases to be made automatically at the time the City's rate
adjustment becomes effective; and
WHEREAS, the Council seeks to incrementally increase rates to customers in order to
address the growing infrastructure and operational needs of the electric utility, while avoiding single -
year larger rate increases; and
WHEREAS, to that end, Council approves changes to the Electric Tariffas attached hereto
in "Electric Rates & Charges 2010 ", effective January 1, 2010, to include a 5% rate increase to all
rate classes and all fees, with thc exception of monthly deposits, with door hanger, NSF check, and
monthly late fees being increased to bring them more in line with current industry standards; and
WHEREAS, the Council further approves changes to the Electric Tariffas attached hereto
in "Electric Rates & Charges 2011" to be effective January 1, 2011, to include a 5°A rate increase to
all rate classes all fees, with the exception of monthly deposits.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF SEWARD, ALASKA that:
CITY OF SEWARD, ALASKA
RESOLUTION 2009-115
UMW
Section 1. Effective January 1, 2010, the Seward City Council hereby approves the adjusted
Electric Tariff rates and charges as attached hereto as ``Electric Rates & Charges — 2010 ".
Section 2. Effective January 1, 2011, the Seward City Council hereby approves the adjusted
Electric Tariff rates and charges as attached hereto as "Electric Rates & Charges — 2011".
Section 3. Effective January 1, 2010 the Seward City Council abolishes the industrial rate
but retains provisions for a special contract for electric service.
Section 4. Effective January 1, 2010 (and contained in "Electric Rates & Charges — 2010 ")
the Seward City Council authorizes an increase in energy charge rates to reflect the increase in the
energy charge passed to the City of Seward by Chugach Electric Association in October, 2009, and
hereafter, as described in "Electric Rates & Charges — 2010 ", authorizes energy and demand charges,
in addition to fuel charges, to be passed through to Seward Public Utility customers at the time rate
changes are imposed on the City of Seward by Chugach Electric Association, after being approved
by the Regulatory Commission of Alaska.
Section 5. This resolution is effective immediately upon passage.
PASSED AND APPROVED by the City Council of the city of Seward, Alaska, this 9 day of
November, 2009.
THE CITY / ( F SEWARD, ALASKA 7.
, : " tc Y Gt'1 L L
Willard E. Dunham, Mayor
AYES: Valdatta, Bardarson, Keil, Smith, Shafer, Amberg, Dunham
NOES: None
ABSENT: None
ABSTAIN: None
ATTEST:
,76(/'I', Vti.- / :< , (( -V Z ( C..
Johanna Doll CMC
Acting City Clerk
(City Seal) ::,' ( °`
�i
N
'9
,
Council Agenda Statement
Meeting Date: November 9, 2009
e of s kis,
Through: Phillip Oates, City Manager V '7"
From: John Foutz, Manager Electric Utility q�p
Agenda Item: Amending Electric Rates and Charges
BACKGROUND & JUSTIFICATION:
The City of Seward's Electric rates must be raiscd for the following reasons. The Electric
Enterprise fund does not have the financial capacity to initiate a replacerent plan for critically
aged infrastructure. The City has not had a rate increase in at least sixteen years. The City has
absorbcd many of the rate increases from their generation supplier, Chugach Electric Association
(CEA). Funds have been transferred from the Electric Fund to other City Funds, adversely
impacting reserves. The costs to replace materials needed to repair essential power lines have
dramatically increased, but failure to increase rates to customers for replacement of these items
has not kept pace with increased costs. In addition, the 2008 and 2009 budgets allocated no
funds toward electric capital improvements.
While the electric department has kept the City's electrical distribution system functioning, it has
not been able to keep pace with important maintenance and replacement items. As a result, the
electric department has been unable to continue essential maintenance and upkeep of equipment
vital to the safety and well -being of the community of Seward.
After five extensive public work sessions aimed at reviewing capital infrastructure needs of the
City's enterprise funds, it has been determined that electric rates will be increased effective
January 1, 2010 by five percent. In addition, rates will increase an additional five percent
effective January 1, 2011. These rates will not allow the City to replace all critical and high -risk
infrastructure items, but reflect incremental increases aimed at balancing the need for additional
revenue requirements, while minimizing the financial impact on the utility's customers.
The attached tariff accomplishes a number of goals. First, it implements an automatic annual
adjustment in the future, to utility rates based on a five -year average of previous years' increases
in the consumer price index. This is intended to keep the utility from falling further behind in its
ability to cover the costs of operations and maintenance. Second, it eliminates the industrial rate
but maintains the current flexibility of offering special contracts. This allows the City to offer
subsidized rates in order to give a business the time to establish itself, but gives the City the
opportunity to stop the subsidy once the business becomes viable. Third, it allows for the
automatic pass - through of future Chugach Electric Association cost increases which the utility
cannot absorb. Fourth, it increases a few specific fees, such as door hangers (from $10 to $25),
NSF checks (from $10 to $35), and late fees (from $2.50 to $5.00), to be more consistent with
industry standards. The revised tariffs for 2010 and 2011 are attached.
CONSISTENCY CHECKLIST: Where applicable, this agenda statement is consistent with the
Seward City Code, Charter, Comprehensive Plans, Land Use Plans, Strategic Plan and City
Council Rules of Procedures.
FISCAL NOTE:
The ability to pass along increases in the consumer price index and Chugach Electric Association
charges to the utility's customers, will enable the City to keep pace with increased costs over
tiinc, and will improve upon the past practice of implementing significant one -time rate
increases.
Approved by Finance Department: %.
ATTORNEY REVIEW: Yes UO
RECOMMENDATION:
Seward City Council approve Resolution 2009 -1 15 amending the Electrical Rates and Charges
tariffs for 2010 and 2011.
1 City of Seward
-- 3 Electric Rates & Charges 2010
4
5 Rates for Electrical Power by Class of Service
6
Class of Service Energy Charge Demand Charge Monthly Operations
& Infrastructure
Residential $0.0942 /kWh N/A
$15.75
Small General Service
(Less than 25 kW) $0.1087/kWh N/A $31.50
$0.0778/kWh (1s 200
Large General Service kWh /kW) $13.65 /kW* $31.50
$0.0465 /kWh
(Additional kWh's)
Yard Lights N/A N/A $7.09 (175 watts)
$10.50 (250 watts)
Street Lights
• $0 1282 N/A $31.50
7
8 * Demand Charges will be based on the maximum demand recorded over a
9 15- minute period.
10
11 These rates are based, in part, on the cost of energy and demand from
1 Chugach Electric Association (CEA) and will change when there is an
13 adjustment to CEA rates charged to the City of Seward.
14
15 Effective January 1, 2012 and each January 1 thereafter, rates will be
1 6 adjusted based on a five -year average of the cost of living as stated in the
17 consumer price index, all items, 1982 -84 =100 for urban wage earners and
1 clerical workers, Anchorage, Alaska area, as published by the U.S.
1 Department of Labor, Bureau of Labor Statistics. (NOTE: 1/1/2012 will
20 utilize CPI Data from 2005- 2009).
City of Seward Electric Tariff
January 1, 2010 per Seward City Council Approval
1
2 A Small General Service customer may elect to be billed under the large
3 General Service schedule; however, the election to change the billing rate
4 from one customer group to another may not be made more often than once
5 every 12 months.
6
7 Definitions And Miscellaneous Charges
8
9 1. CEA Fuel Adjustment: The fuel adjustment charge from Chugach Electric
10 Association directly distributed to Seward Electric Utility customers
11 prorated according to the number of kWh the customers consumed during
12 the billing period.
13
14 2. Seward Fuel Adjustment: The cost of operating the standby generation
15 plant, including fuel, labor, maintenance and repair when it exceeds the
16 amount budgeted to date for the fiscal year. The cost will be prorated
1 according to the number of kWh the customer consumed during the billing
18 Period.
19
20 3. Special Contracts: Special contracts may be negotiated by the Utilities
21 Manager with customers that have a demand in excess of 750 kW or that
22 have unique power requirements that cannot be reasonably addressed by the
23 large general service tariff. Special contracts may include, but are not
24 limited to, provisions for instantaneous demand charges, time of service,
25 interruptible power, minimum and maximum demand, adjustment of
26 demand level, ownership and payment of new distribution facilities,
27 termination charges and power factor. Special contracts must be approved
28 by the City Council.
29
30 4. VAR Change (Power Factor Adjustment): All schedules requiring
31 demand metering will be subject to the following power factor adjustment
32 provisions:
33
34 A: Demand - metered customer should attempt to maintain a unity
35 power factor. if the power factor falls below ninety percent lagging,
36 the customer will take corrective steps to return the power factor to
37 ninety percent or higher. Also, the following charge for billed
38 kilowatts will apply:
39 Monthly Billing Demand = Maximum Demand x 90%
40 Actual Power Factor
City of Seward Electric Tariff
January 1, 2010 per Seward City Council Approval
1 B: All power factor adjustment equipment installed by the
2 customer must be approved by the city. Power factor can be
3 determined by permanently installed monitoring equipment or by
4 periodic testing at reasonable intervals, at the discretion of the City.
5
6
7 5. Standby Generation: the cost of operating the standby generation plant to
8 meet a specific customer's need will be charged directly to that customer.
9 Such cost will be the total cost of operating the plant, including fuel, labor,
10 overtime, maintenance, repair and overhead, less the value of energy
11 generated in excess of customer's need.
12
13 6. Other Miscellaneous Fees and Charges: Fees and charges for existing
14 facilities follow on Page 4. Engineering service fees and charges for new
15 facilities follow on Page 5. Fees on Pages 4 and 5 are listed according to
16 service zones as follows:
17
18 ZONE I Inside City Limits (excluding the Small Boat Harbor).
19
20 ZONE 11 City limits to mile 12, Seward Highway, and all roads
21 connecting to the highway within this area.
22
23 ZONE III Mile 12 to Lawing.
24
25 7. APUC Regulatory Cost Charge: A special surcharge of $0.000626 /kWh
26 imposed on electrical utilities by the Regulatory Commission of Alaska
27 (RCA) in response to the state's intent to assess user fees to support
28 activities of the RCA and departments. This charge was recommended by
29 the RCA as a pass through charge to retail utilities customers.
City of Seward Electric 'Tariff
January 1, 2010 per Seward City Council Approval
1
1 Service Zone I _ Zone II Zone III
Meter Testing, per Test, When previous test 7
occurred within the last 24 months $52.50 $73.50 $94.50
Reconnection to approved existing meter
installation $21.00 $26.25 $31.50
Reconnection to approved existing meter
installation outside regular business hours $147.00 $178.50 $210.00
New connection fee $157.50 $157.50 $157.50
Minimum Deposit - Residential Account $100.00 _ $100.00 $100.00
Minimum Deposit - Commercial or $200.00 $200.00 $200.00
Industrial Account
Deposit - Interruptible, Off -Peak Account:
The larger of twice the estimated monthly $200.00 $200.00 $200.00
bill OR
-
Tampering with or unauthorized breaking
of meter seal $525.00 $525.00 $525.00
Per Annum interest on delinquent account 10.50% 10.50% 10.50%
Door Hanger Fee $25.00 $25.00 $25.00
Monthly late fee on delinquent account $5.00 $5.00 $5.00
Dishonored check fee $35.00 $35.00 $35.00
Reconnection during regular business hours
following disconnection of delinquent $42.00 $52.50 $63.00
account
Reconnection outside regular business
hours following disconnection of $147.00 $178.50 $210.00
delinquent account
r-
2
City of Seward Electric Tariff
January 1, 2010 per Seward City Council Approval
1
Service Zone I Zone II Zone III
Temporary secondary service
$52.50 $63.00 $73.50
Primary Overhead Extensions (Residence)
$52.50 $63.00 $73.50
Primary Underground Extensions
(Residence) $52.50 $63.00 $73.50
Secondary service $52.50 $63.00 $73.50
Primary Overhead extensions (Subdivision,
Mobile Home Park, Multi - Residence) $105.00 $126.00 $147.00
Primary Overhead Extensions (Commercial
& Industrial) $210.00 $252.00 $273.00
Primary Underground Extensions
(Commercial & Industrial) $210.00 $252.00 $273.00
Modifications of Existing Facilities $105.00 $126.00 $147.00
Street Lighting Systems and Yard Lights $52.50 $63.00 $73.50
2
3 NOTE: The Zone Fee or Charge is non - refundable until the service is connected.
4 If the service is constructed and connected, the charge will be adjusted to
5 the actual coast of engineering services.
6
7 See Page 2 -3 for description of Zones I, 1I and III.
8
City of Seward Electric Tariff
January 1, 2010 per Seward City Council Approval
1 City of Seward
2
— 3 Electric Rates & Charges 2011
4
5 Rates for Electrical Power by Class of Service
6
Class of Service Energy Charge Demand Charge Monthly Operations
& Infrastructure
Residential N/A
$0.0989/kWh $16.54
Small General Service
(Less than 25 kW) N/A
$0.1 141 /kWh $33.08
Large General Service $0.0817 /kWh (l 200
kWh /kW) $0.0488 $14.33/kW* $33.08
.� (Additional kWh's)
Yard Lights N/A N/A
$7.44 (175 watts)
$11.03 (250 watts)
Street Lights N/A $33.08
$0.1346
7
8 * Demand Charges will be based on the maximum demand recorded over a
9 15- minute period.
10
11 These rates are based, in part, on the cost of energy and demand from
12 Chugach Electric Association (CEA) and will change when there is an
1 adjustment to CEA rates charged to the City of Seward.
1 4
15 Effective January 1, 2012 and each January 1 s ` thereafter, rates will be
1 adjusted based on a five -year average of the cost of living as stated in the
1 consumer price index, all items, 1982 -84 =100 for urban wage earners and
18 clerical workers, Anchorage, Alaska area, as published by the U.S.
City of Seward Electric Tariff
January 1, 2011 per Seward City Council Approval
1 Department of Labor, Bureau of Labor Statistics. (NOTE: 1/1 /2012 will
2 utilize CPI Data from 2005- 2009).
3
4 A Small General Service customer may elect to be billed under the large
5 General Service schedule; however, the election to change the billing rate
6 from one customer group to another may not be made more often than once
7 every 12 months.
8
9 Definitions And Miscellaneous Charges
10
11 1. CEA Fuel Adjustment: The fuel adjustment charge from Chugach Electric
12 Association directly distributed to Seward Electric Utility customers
13 prorated according to the number of kWh the customers consumed during
14 the billing period.
15
16 2. Seward Fuel Adjustment: The cost of operating the standby generation
17 plant, including fuel, labor, maintenance and repair when it exceeds the
18 amount budgeted to date for the fiscal year. The cost will be prorated
19 according to the number of kWh the customer consumed during the billing
20 Period.
21
22 3. Special Contracts: Special contracts may be negotiated by the Utilities
23 Manager with customers that have a demand in excess of 750 kW or that
24 have unique power requirements that cannot be reasonably addressed by the
25 large general service tariff. Special contracts may include, but are not
26 limited to, provisions for instantaneous demand charges, time of service,
27 interruptible power, minimum and maximum demand, adjustment of
28 demand level, ownership and payment of new distribution facilities,
29 termination charges and power factor. Special contracts must be approved
30 by the City Council.
31
32 4. VAR Change (Power Factor Adjustment): All schedules requiring
33 demand metering will be subject to the following power factor adjustment
34 provisions:
35
36 A: Demand - metered customer should attempt to maintain a unity
37 power factor. If the power factor falls below ninety percent lagging,
38 the customer will take corrective steps to return the power factor to
39 ninety percent or higher. Also, the following charge for billed
40 kilowatts will apply: WNW
41 Monthly Billing Demand = Maximum Demand x 90%
City of Seward Electric Tariff
January I, 2011 per Seward City Council Approval
1 Actual Power Factor
2
13: All power factor adjustment equipment installed by the
3 customer must be approved by the city. Power factor can be
4 determined by permanently installed monitoring equipment or by
5 periodic testing at reasonable intervals, at the discretion of the City.
6
7
8 5. Standby Generation: the cost of operating the standby generation plant to
9 meet a specific customer's need will be charged directly to that customer.
10 Such cost will be the total cost of operating the plant, including fuel, labor,
11 overtime, maintenance, repair and overhead, less the value of energy
12 generated in excess of customer's need.
13
14 6. Other Miscellaneous Fees and Charges: Fees and charges for existing
15 facilities follow on Page 4. Engineering service fees and charges for new
16 facilities follow on Page 5. Fees on Pages 4 and 5 are listed according to
17 service zones as follows:
18
19 ZONE 1 Inside City Limits (excluding the Small Boat Harbor).
20
21 ZONE 11 City limits to mile 12, Seward Highway, and all roads
` 22 connecting to the highway within this area.
23
24 ZONE I11 Mile 12 to Lawing.
25
26 7. APUC Regulatory Cost Charge: A special surcharge of $0.000626 /kWh
27 imposed on electrical utilities by the Regulatory Commission of Alaska
28 (RCA) in response to the state's intent to assess user fees to support
29 activities of the RCA and departments. This charge was recommended by
30 the RCA as a pass through charge to retail utilities customers.
City of Seward Electric Tariff
January 1, 2011 per Seward City Council Approval
Service Zone I Zone 11 Zone III
Meter Testing, per Test, When previous test
occurred within the last 24 months $55.13 $77.18 $99.23
Reconnection to approved existing meter
installation $22.05 $27.56 $33.08
Reconnection to approved existing meter
installation outside regular business hours $154.35 $187.43 $220.50
New connection fee
$165.38 $165.38 5165.38_
Minimum Deposit - Residential Account $100.00 $100.00 $100.00
Minimum Deposit - Commercial or $200.00 $200.00 $200.00
Industrial Account
Deposit - Interruptible, Off -Peak Account:
The larger of twice the estimated monthly $200.00 $200.00 $200.00 T
bill OR
Tampering with or unauthorized breaking
of meter seal $551.25 $551.25 $551.25
Per Annum interest on delinquent account 10.50% 10.50% 10.50%
Door Hanger Fee
$26.25 $26.25 $26.25
Monthly late fee on delinquent account
$5.25 $5.25 $5.25
Dishonored check fee
$36.75 $36.75 $36.75
Reconnection during regular business hours
following disconnection of delinquent
account $44.10 $55.13 $66.15 r
City of Seward Electric Tariff
January 1, 2011 per Seward City Council Approval
Reconnection outside regular business
hours following disconnection of
delinquent account $154.35 $187.43 $220.50
City of Seward Electric Tariff
January 1, 2011 per Seward City Council Approval
Service Zone I Zone II Zone III r
Temporary secondary service
$55.13 $66.15 $77.18
Primary Overhead Extensions (Residence)
$55.13 $66.15 $77.18
Primary Underground Extensions
(Residence) $55.13 $66.15 $77A8
Secondary service
$55.13 $66.15 $77.18
Primary Overhead extensions (Subdivision,
Mobile Home Park, Multi - Residence) $110.25 $132.30 $154.35
Primary Overhead Extensions (Commercial
& Industrial) $220.50 $264.60 $286.65 ---
Primary Underground Extensions
(Commercial & Industrial) $220.50 $264.60 $286.65
Modifications of Existing Facilities
$110.25 $132.30 $154.35
Street Lighting Systems and Yard Lights $77.18
$55.13 $66.15
2
3 NOTE: The Zone Fee or Charge is non - refundable until the service is connected.
4 If the service is constructed and connected, the charge will be adjusted to
5 the actual coast of engineering services.
6
7 See Page 2 -3 for description of Zones I, II and I1I.
8
9
City of Seward Electric Tariff
January 1, 2011 per Seward City Council Approval