Cheney power users — current and future — have some changes in store for them in 2016.
Due to City Council passage of a utility fees resolution at their Dec. 8 meeting, Cheney Light Department residential users will see a 6 percent rate increase go into effect in early January, rising from 5.64 cents per kilowatt hour to 6 cents. Commercial users under 15,000 kilowatts per month will see an increase of 1.44 percent, from 6.16 cents to 6.25 cents, while those using over 15,000 kilowatts per month will see their rates go up 10.73 percent from 3.66 cents to 4.10 cents per kilowatt hour.
It’s the second increase this year — council approved a 6 percent increase in late March — but only the second increase in electric rates since 2001. Prior to this year, annual increases in power purchased from Bonneville Power Administration had been paid for through Light Department reserves, depleting those funds to dangerously low levels.
Charges for service hookups also increased, as did rates for using specific outdoor lamps and per charges for non-residential users who exceed 50,000 kilowatt-hours (kW) per month. A separate resolution changed how this is measured from kW to kilovolt amps (KVA).
Currently the city institutes a kW demand and power-factor charge, but new metering technology now allows the Light Department to use the more accurate KVA measurement, which merges both factors into one and makes it easier to assess and understand a customer’s bill. Residential customers won’t see these new measurements as Light Department Director Steve Boorman said they mainly apply to industrial loads.
Residential Light Department customers outside Cheney’s city limits will see other changes on their bills, namely in the form of taxes and fees currently charged to in-city users. A new section, “Municipal tax on electric utility” in the code’s Chapter 14, states city utility taxes that are imposed are done so as a cost to the respective utility fund as a percentage of gross income.
The tax is therefore imposed on the entire utility’s electric service area and not as a surcharge upon the individual rate. As such, it becomes a cost of doing business that can then be passed along to users.
Boorman said 250 of the system’s 5,500 total meters are outside city limits, mostly along a line along the Cheney-Spokane Road to Fish Lake, another stretching about 2-3 miles towards Turnbull National Wildlife Refuge and a short one north along Murphy and Paradise roads.
“They were getting a better deal for being a city customer versus those inside the city,” Boorman said.
Another code amendment adds a requirement for an external service disconnect switch to all new permanent commercial and direct meter industrial installations, similar to what is currently required for residential users. The amendment also includes a requirement for all direct-metered commercial and industrials meters to have a bypass-style meter base.
Boorman said the reasoning behind this new provision is safety-based. Fire department personnel will not enter a possible burning building unless they can be certain the power is disconnected.
“If there is a disconnect (switch) and they can go and shut it off, they can get right to it,” Boorman said.
The final code addition is a new section regarding “New Large Single Electric Load” users. This would apply to new users requiring high amounts of electricity, such as a server farm, and allows the council to determine the rate and class of the user depending upon a number of factors, including impacts to existing users, price of power from BPA and additional transmission costs.
“We want to make sure these users don’t hammer existing customers’ rates,” Boorman said.
The section defines a “New Large Single Load” user as one requiring over one average megawatt of power. It also allows the council to take into consideration the financial impacts to the city of a such a users, i.e., number of jobs brought to the community.
“It’s a policy question at that time, one that the council should answer,” Boorman said.
Fee, rate and service charge changes take place 30 days after City Council passage of the resolution.
John McCallum can be reached at jmac@cheneyfreepress.com.
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