Rate Proceeding November 5, 2019 Chehalis Agenda Whats Driving the - - PowerPoint PPT Presentation

Rate Proceeding

November 5, 2019 – Chehalis

Agenda

▪ What’s Driving the Rate Increase? ▪ Proposed Rate Changes ▪ Residential Rate Increase ▪ Residential Rate Comparison ▪ Commercial Rate Increase ▪ Review Staff Proposal ▪ Programs and Services to Assist Customers ▪ Key Dates ▪ Questions / Answers

What’s Driving the Rate Increase?

▪ BPA Wholesale Power and Transmission Rates

⚫ Power surcharge analysis to be completed in November 2019 ⚫ Transmission increase October 1, 2019

❖Financial Reserve Policy ❖Reduced revenue from surplus power sales ❖Needed capital investment ❖Mandatory compliance requirements

▪ Depressed Surplus Power Prices

⚫ Reduced revenue from surplus sales

▪ Energy Independence Act (EIA) aka I-937

⚫ Renewable energy requirement – 2012 (3%) – 2016 (9%) – 2020 (15%)

▪ Conservation

⚫ Reduced retail sales, partially offset by increased surplus power sales

What’s Driving the Rate Increase?

▪ Capital Projects Investment & Contract Tree Trimming

⚫ Increase in investments to ensure reliable service

▪ Increasing Operating Costs – Material, Goods & Labor

⚫ Reliable service and compliance requirements

▪ Cash Reserves Level

⚫ Cash reserves are less than optimal

▪ Current and Future

⚫ Loss of Residential Exchange Credit / Industrial Load Loss / Clean Energy Transportation Act (CETA)

Proposed Rate Changes

▪ Proposed Rate Changes Effective January 1, 2020

⚫ No change to the per day basic charge

❖Single phase = $0.95 ❖Three phase = $1.57

⚫ No change to the demand charge ⚫ Increase energy (kWh) charge for all metered accounts

❖Residential, Industrial, and Irrigation kWh rate schedules increased 4.75% ❖Residential customer using 1,400 kWh per month would see an increase of $4.43 or 3.6% per month (excluding city taxes) ❖Commercial declining rate block differential reduced

• First tier – 0 to 15,000 kWh increase 2.73%
• Second tier – over 15,000 kWh increase 10.55%

❖Impacts customers within a class differently

Proposed Rates Residential Rate Increase

Present Rates Proposed Rate Option Energy Rate ($/kWh) 0.06293

0.06591

4.74% Base ($/day) 0.95 0.95 kWh Monthly Bill Monthly Bill $ Difference Percent Difference 100 36.89 $ 37.20 $ 0.31 $ 0.9% 200 43.56 44.19 0.63 1.5% 300 50.23 51.18 0.95 1.9% 400 56.90 58.16 1.26 2.2% 500 63.57 65.15 1.58 2.5% 600 70.24 72.14 1.90 2.7% 700 76.91 79.13 2.22 2.9% 800 83.59 86.11 2.52 3.0% 900 90.26 93.10 2.84 3.2% 1,000 96.93 100.09 3.16 3.3% 1,100 103.60 107.07 3.47 3.3% 1,200 110.27 114.06 3.79 3.4% 1,300 116.94 121.05 4.11 3.5% 1,400 123.61 128.04 4.43 3.6% 1,500 130.29 135.02 4.73 3.6% 1,600 136.96 142.01 5.05 3.7% 1,700 143.63 149.00 5.37 3.7% 1,800 150.30 155.99 5.69 3.8% 1,900 156.97 162.97 6.00 3.8% 2,000 163.64 169.96 6.32 3.9% 2,500 197.00 204.90 7.90 4.0% 3,000 230.36 239.83 9.47 4.1% 3,500 263.71 274.77 11.06 4.2% 4,000 297.07 309.71 12.64 4.3% 4,500 330.43 344.64 14.21 4.3% 5,000 363.78 379.58 15.80 4.3% 5,500 397.14 414.52 17.38 4.4%

Based on 30 day month, includes Public Utility Tax 3.8734% and Privilege Tax 2.14%, does not include city taxes

Residential average monthly consumption

Residential Rate Comparison

Proposed Rates Commercial Rate Increase

Tier 1 only Tier 1 + Tier 2

Present Rates Proposed Rate Option Energy Rate ($/kWh) 0 to 15,000 0.06416

0.06591

2.73% Over 15,000 0.04292

0.04745

10.55% Demand Charge ($/kW) First 50 0.00 0.00 Over 50 5.81 5.81 Base ($/day) Single Phase 0.95 0.95 Three Phase 1.57 1.57 kWh Monthly Bill Monthly Bill $ Difference Percent Difference 500 64.22 $ 65.15 $ 0.93 $ 1.4% 1,000 98.23 100.09 1.86 1.9% 2,000 166.25 169.96 3.71 2.2% 3,000 234.27 239.83 5.57 2.4% 4,000 302.29 309.71 7.42 2.5% 5,000 370.30 379.58 9.28 2.5% 7,500 540.35 554.26 13.91 2.6% 10,000 710.40 728.95 18.55 2.6% 12,500 880.44 903.63 23.19 2.6% 15,000 1,050.49 1,078.32 27.83 2.6% 20,000 1,277.99 1,329.83 51.84 4.1% 25,000 1,505.50 1,581.35 75.85 5.0% 30,000 1,733.00 1,832.87 99.86 5.8% 35,000 1,960.51 2,084.38 123.88 6.3% 40,000 2,188.01 2,335.90 147.89 6.8% 45,000 2,415.52 2,587.42 171.90 7.1% 50,000 2,643.02 2,838.93 195.91 7.4% 60,000 3,098.03 3,341.97 243.94 7.9% 70,000 3,553.04 3,845.00 291.96 8.2% 80,000 4,008.05 4,348.03 339.98 8.5% 90,000 4,463.06 4,851.07 388.01 8.7% 100,000 4,918.07 5,354.10 436.03 8.9% 250,000 11,743.21 12,899.60 1,156.39 9.8% 500,000 23,118.45 25,475.44 2,357.00 10.2%

Based on 30 day month, includes Public Utility Tax 3.8734% and Privilege Tax 2.14%, does not include demand or city taxes

Review Staff Proposal

▪ Proposed Rate Changes Effective January 1, 2020

⚫ No change to the per day basic charge

❖ Single phase = $0.95 ❖ Three phase = $1.57

⚫ No change to the demand charge ⚫ Increase energy (kWh) charge for all metered accounts

❖ Residential, Industrial, and Irrigation kWh rate schedules increased 4.75% ❖ Residential customer using 1,400 kWh per month would see an increase of $4.43 or 3.6% per month (excluding city taxes) ❖ Commercial declining rate block differential reduced

• First tier – 0 to 15,000 kWh increase 2.73%
• Second tier – over 15,000 kWh increase 10.55%

❖ Impacts customers within a class differently

▪ Comprehensive Rate Study to be Completed in 2021

⚫ Revenue requirement ⚫ Cost of Service Analysis (COSA) ⚫ Rate design - additions/adjustments

Programs and Services to Assist Customers

▪ FREE Energy Audits ▪ Rebates and Incentives ▪ Low Income Weatherization ▪ Commercial/Industrial Efficiency Programs ▪ Energy Efficiency Loans ▪ Residential Budget Payment Plans ▪ Project Share Assistance ▪ Community Organization Referrals

Key Dates

▪ September 17, 2019 Commission acceptance of Rate Proceeding

date and approval for publication of Rate Proceeding Notice

▪ September 19 and 26, 2019 Publish Rate Proceeding Notice ▪ October 4, 2019 Information available on website and at District

• ffices

▪ October 15, 2019 PUD Rate Proceeding - Morton ▪ November 5, 2019 PUD Rate Proceeding - Chehalis ▪ November 5, 2019 Final date to receive written comments from

the public prior to resolution prepared for Commission adoption

▪ November 19, 2019 First reading of new rate schedule resolution ▪ December 3, 2019 Second reading and approval of new rate

schedule resolution, action effective January 1, 2020

Questions / Answers

www.lcpud.org

Thank You.

Brad Ford, CFO 360.740.2417 bradf@lcpud.org www.lcpud.org