Truth or Consequences City Commissioners approved an electric rate increase (starting Jan. 1, 2024) at their Dec. 13 meeting.
Residents currently pay $8 a month for the “customer service charge,” which will go up to $18 a month.
Residents currently pay a “base” rate of nine cents or $0.09 per kilowatt. That charge will go down to a little over eight cents or $0.0813 per kilowatt.
Residents currently pay an “energy cost adjustment” rate of a little over four cents or $0.0414 per kilowatt. That charge will go up to over six cents or $0.0621 per kilowatt.
Adding the base and energy cost adjustment rates, residents are currently paying $0.1314 per kilowatt. The new rate will be $0.1434 per kilowatt.
The city commission not only passed a resolution that increases electric rates, it also passed three ordinances amending the city’s utility code. One ordinance stipulates that if the wholesale energy rates go up (WAPA, Tristate or Sierra Electric Cooperative), those increases can “automatically” be passed onto the customer immediately.
Similarly, if “energy” costs, such as the price of gasoline or diesel, increase the city electric department’s costs, those too can be passed onto the customer immediately.
In addition, the ordinance states that electric rates will start going up yearly by the amount of the “consumer price index” starting July 1, 2027.
The city commission passed an ordinance in 2019 that increases water rates by the consumer price index each year. Water rates went up about 50 percent in October of 2019 and increased over 5 percent July 2020 and over 9 percent in July 2021. The increase applied to the monthly customer service charge as well as per-1,000- gallons rates. Over the last four years water rates have gone up over 70 percent.
Expect the same galloping increases in electric rates starting July 2027.
The ordinance just passed will similarly increase all electric-rate charges by the consumer price index—the customer service monthly charge, the base kilowatt charge and the energy cost adjustment charge.
City Electric Department Director Bo Easley and Utility Office Manager Sonya Renfro said the rate increases are based on the city’s recent electric rate study. The city hired 1898 & Company, the study conducted by their engineer, Craig Brown. Brown was not asked to compare the city’s rates with others through the state, which is usually par for the course with other rate studies. Brown’s proposed increases were based on the city’s need for revenue to fix the long-neglected electric facility. Brown noted that the city, for years, had transferred out, on average, about $1.5 million in rate receipts a year. He said that same amount in repairs needs to be made each year for at least five years to keep the utility operational.
For more information on the city’s historical electric rates and the rate increase, please see:
https://sierracountycitizen.org/proposed-electric-rate-increase-is-based-on-lies/
What was entirely missing from the city commission’s limited discussion on the ordinances and resolution affecting electric rates was the proposed sale of the city’s electric facility to Sierra Electric Cooperative. The city commission has kept those negotiations and related studies secret for two and a half years.
Mayor Pro Tem Rolf Hechler stated several months ago, when Brown presented his electric rate study, that the city commission needed to determine if it were going to sell the utility or not before raising rates—that they owed that to their constituents. He, along with the other city commissioners, unanimously passed the ordinances and electric-rate-increase resolution.