|
Building electric reliability |
|
Friday, 25 April 2008 |
Rate credit termination supported, substations to improve system
By WILLIAM LANEY
Managing Editor
A city ordinance terminating an electric power credit for Wapakoneta consumers at the end of May is likely to pass after members of two city committees supported the legislation.
Members of Wapakoneta City Council’s Finance Committee and Utilities Committee concurred the electric power credit of 0.7 cents per kilowatt hour should end, five months after the credit was supposed to lapse, on May 31.
“We were able to provide a credit for nearly 2 1/2 years to help residents and businesses adjust to the electric rate increase caused by electric deregulation, so I think we, as city councilors and city administrators, did a pretty good job,” Councilor-at-large Wilbur Wells told the Wapakoneta Daily News after Wednesday’s joint meeting. “We know have to shift our focus and use the money from the Electric Rate Stabilization Fund to provide a better and a more reliable electric utility system for our residents and consumers.
“We are not just going to sit on the money,” the Finance Committee chair said. “We are going to put it to work for us to make a better Wapakoneta.”
Councilors heard the first reading of legislation Monday to extend the credit until bills are sent out prior to May 31.
In January 2006, councilors approved a credit of 1.4 cents per kilowatt hour, and in January 2007, councilors voted to extend the electric power consumption credit at 0.7 cents per kilowatt hour.
Wells pushed for the credit when electric rates charged to the city increased to approximately 6.375 cents per kilowatt hour under the terms of a two-year contract with American Electric Power (AEP) from 2.7 cents per kilowatt hour under the terms of a seven-year contract with AEP in 1998.
Today, the city pays approximately 6.375 cents per kilowatt hour, through a myriad of contracts with staggered expirations through deals with American Municipal Power of Ohio (AMP-Ohio) and AEP.
Utilities Committee member Steve Walter said the credit was supposed to end in January, being reflected on bills consumers received in February, and should end.
“From a Utilities Committee perspective, it was supposed to sunset in January so it should sunset,” Walter said during the meeting.
Safety-Service Director Rex Katterheinrich said removing the credit from the average Wapakoneta electric consumer’s bill, based on 905 kilowatt hour usage per month, would result in an increase of $6.33 in their monthly charge.
The credit cost the city’s Rate Stabilization Fund
approximately $189,000 per month, Katterheinrich told committee members.
The Rate Stabilization Fund, created by councilors in 1998, was established to help absorb large electric rate increases and to provide money for capital improvements. It is funded through an additional charge to consumers.
During Wednesday’s meeting, Katterheinrich also revealed city administrators developed a 5-year capital improvements plan for the city electric power system. The plan includes three main projects.
The first project is to replace and to upgrade the Middle Street substation. Working with General Electric representatives, it is estimated to cost $3.8 million for work inside the fence.
The safety-service director said the project includes replacing 350 transformers in the area of the substation at an estimated cost of $1 million.
The second project would be to replace the Harrison Street substation, the city’s major substation, at a cost of $5.4 million. Katterheinrich said the Harrison Street substation upgrade would allow the substation to carry the load of either the Middle Street substation or the Defiance Street substation, if one of the two failed.
The third project would replace the Defiance Street substation at a cost of $3.4 million.
Transformers also would be replaced in the service areas of the Harrison Street and Defiance Street substations.
“We are building reliability into our distribution system,” Katterheinrich said. “Our goal is right now to ask you if we can do a design build on these projects — where we have the designer and builder be the same company. We feel that will provide us with a much better job and a more reliable installation of the substations.”
|
|
Last Updated ( Saturday, 26 April 2008 )
|
