posted on August 31, 2018 13:25
On August 28, 2018, Kerrville Public Utility Board (KPUB) held a special budget workshop as well as its regular board meeting. Among items presented at the regular board meeting for consideration was a proposed rate adjustment.
The proposed adjustment is based on a Cost of Service and Rate study conducted by Utility Financial Solutions (UFS) that was completed earlier this year. The consultant’s findings were first presented to the Board at the January 2018 regularly scheduled board meeting. Cost of service and rates have been much discussed and researched in the ensuing months by KPUB staff and the Board of Directors. KPUB’s last rate adjustment was in 2012.
UFS projections demonstrate there is a need to increase rates. To ease the transition into this new pricing structure, KPUB’s board elected to implement smaller rate increases in phases, with a 2.2 percent overall increase approved for October 2018 and a 2 percent increase projected for October 2020.
Each customer class is being adjusted differently to align the rates for each class with the cost to serve that class. Commercial and Lighting rate classes will see adjustments ranging from 1% to 4.2%. The proposed rate increase for the Residential customer class is 2.6%.
Because the rates have both fixed and variable charges, the actual increase customers may see will depend on how much energy they consume in any given month. According to the Study’s data, an average KPUB residential customer uses about 1150 kWh per month and would see their monthly bill for that usage increase by $2.57 from $99.84 to $102.41. Customers with monthly consumption that is lower than the average will see higher percentage rate increases because of the increase in the fixed monthly Customer Charge.
Also discussed at the August 28th KPUB Board meeting was a new Economic Development Rate that could be used to target businesses expanding in Primary Industries, businesses with significant load expansions, and retail, arts, and entertainment businesses in the City’s proposed TIRZ district.
Even with these modest rate increases, KPUB remains highly competitive in rates and is well above industry standards for customer satisfaction. For many years, KPUB customers have consistently paid rates below comparable regional electric power providers. Kerrville is fortunate to have a locally owned electric grid where the community has input into the governance of the utility and where the utility has an interest in seeing the community thrive.