TIPP CITY — On Tuesday night, the Tipp City council approved a $2.27 million substation upgrade project, as well as changes to the city’s electric rates.
Council accepted a bid from J.W. Didado for the construction of upgrades to the city’s Substation No. 1. The city did receive one lower bid, but it was withdrawn after city staff and the designing engineer determined that the bidder was unqualified.
The change in the city’s electric rates will increase the base rate to $10, which will be balanced by a decrease in the cost per kilowatt hour. Finance Director John Green said many residential customers will see a small decrease in their monthly bill.
“One’s going up, but one’s going down and we’re restructuring things so that you’re going to see very little pain at the pump, so to speak, or pain at the switch,” Mayor Joe Gibson said.
Green said approximately 60 percent of residential customers will see “some sort of decrease.”
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.
Green previously told council 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.
City Manager Tim Eggleston said the change will also make the city’s industrial rates more competitive with Dayton Power & Light.
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