Title
Draft Resolution - Approval to Amend Tariff and Business Rules - 2020 Rate Plan - N Mack | D Thompson
Other Info
Submitted By: Robyn Miller on behalf of David Thompson
Department: Markets
Financial Impact and Cost/Benefit Considerations:
Reduction of Cooperative revenue from rates is anticipated to be reduced by a total of approximately $5M per year; expenditures of staff time not anticipated to be impacted. The anticipated reduction in revenue from rates breaks down as follows:
* The Cooperative anticipates absorbing the current Water Well rate schedule into the Residential rate schedule to yield no significant fiscal impact.
* The Cooperative anticipates removal of the Power Cost Adjustment component (PCA) within the Power Cost Recovery (PCR) to have a neutral fiscal impact.
* The Cooperative anticipates the lowering of the Base Power Charge will reduce Members' bills in the aggregate by approximately $5M per year and will reduce the Cooperative's revenues collected from rates by $5M per year.
Discussion
On December 13th 2019 the Board approved its 2020 Rate Plan which included adjustments or deletions of the following rates included in the Tariff and Business Rules (the "Tariff") of the Cooperative. These changes are proposed to become effective June 1, 2020 to allow for proper notice to Members and ensure transparency in implementation of these changes. These amendments to the Tariff are found in the orange boxes located within the text of the proposed draft Tariff in Section 500: Rates as detailed below:
* Section 500.2.1.5: Water Well
* Section 500.1.5: Power Cost Adjustment (PCA)
* Section 500.1.4: Base Power Charge
The Water Well rate schedule (current Tariff Section 100.2) became effective in February 2005. The rate was designed for small scale agricultural purposes and was originally charged based on connected horsepower. Currently, the Water Well rate schedule is charged based on energy usage (kWh), similar to the residential rat...
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