TIPP CITY — At their last meeting, the Tipp City council returned to a discussion of the city’s electric rates.
According to Finance Director John Green, the city’s rates are not competitive with other area providers, monthly customer charges are inadequate and the city’s power cost adjustment is too high.
“We’re trying to keep our rates as low as possible, trying to make sure we have reliable service, trying to make sure we’re fair to all different classes of customers and competitive,” he said.
Green told council that the $4 fixed monthly customer charges are much lower than surrounding communities, while the city’s power cost adjustment is higher than it should be.
The monthly fixed customer charges have not been adjusted since 1991 and a study of the city’s rates suggested that the fixed monthly customer charge should be approximately $16 per month for residential users, but recommended raising the rate to $10 as a midpoint. Commercial and industrial rates are higher than Dayton Power and Light’s, he said.
The power cost adjustment is dependent on energy sales and recovers the difference between the fixed rates and the actual power costs over a rolling six month average. It was last reset in 2009 and exceeds .05 cents per kilowatt hour.
Green said that adjusting the rates would decrease electric utility revenue, but noted that energy sales have increased in recent years, while debt service and capital outlay expenses have decreased.
If the customer charges go up to $10 per month and the power cost adjustment is reset, the average residential user would see little change to their electricity bill, Green said.
Reach Cecilia Fox at email@example.com.