1995 RES R-32-95 - Laserfiche WebLink

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The PCA is recommended to be changed from the current $.00558 per kwh to $.00858 per kwh. This change is expected to increase revenues from this source from an annual $1.3 million to around $2.0 million or an increase of $700,000. In addition, Staff recommends changing the upper limit in the PCA balancing account from $400,000 to $900,000. The increase in the PCA and the change in policy will help guarantee payment on power bills, and will help meet expenses associated with energy just now being received from San Juan Unit 43. Staff plans on reviewing the PCA and making a recommendation on reducing the PCA from $.00858/kwh before April, 1996, consistent with actual power costs, particularly those of San Juan Unit 43. The balance of the $1.8 million proposed revenue increase (less $700,000 from the PCA) or $1.1 million, would come from increases in base rates resulting in new rates. The increases in base rates as proposed result in a 3.5% annual increase in base revenues compares with rates scheduled to become effective July 1, 1995. Increases would vary by class of service consistent with the March 14, 1994 report submitted to the Utilities Commission on rate design and the associated report on cost of service. FINANCIAL IMPACT Electric Utility revenues would increase approximately $1.8 million between April 3, 1995, and June 30, 1996, compared with revenue projections from current rates and the current PCA. In 1994-95 $500,000 will be anticipated; $1.3 million in 1995-96; and, $1.3 million in every year thereafter. RECOMMENDATION Staff recommends City Council adoption of the attached Resolution to approve Staff proposed changes to the Electric Utility Customer Service Policy as presented.