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- Cost increases in wholesale power will reflect an increase in electric rates for Nephi Customers
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By Myrna Trauntvein
Times-News Correspondent
Electric rates for Nephi will go up for the coming year reflecting the rise of the cost of power to the city.
A recent change in the cost of wholesale power supplied to the city, which became effective July 1, means that rates charged to locals residents and businesses will also have to be increased.
"Factors pushing wholesale power purchase costs higher include the cost of retrofitting existing power plants to meet new environmental regulations, higher costs for meeting environmental protection concerns and regulations for new power plants and reduced savings derived from selling excess power resources," said Randy McKnight, city administrator.
Trends in these and other areas translate into higher costs now and into the future, he said.
"Electric rates have not been changed for Nephi customers since 1986," said McKnight. "Even with the increase, residential rates continue to be among the lowest in the state. If you moved somewhere else, you would pay significantly more."
The residential rate is for customers requesting electric service at 120 volts, 120/240 volts, or 120/208 volts (network) and is available at any point in Nephi's system where there are facilities of adequate capacity.
The "minimum rate," as it has been with other utilities in the city, has been changed to reflect the new idea that all consumers must pay for the development, maintenance and updating of the system. Therefore, a "customer charge" has been adopted.
There will be a customer service charge of $5.50 per month for residential connections and, in addition, there will be an energy charge of 7-cents per KWH (kilowatt-hour).
When electricity is purchased, it is charged by the kilowatt-hour (KWH). When the customer uses 1000 watts for 1 hour, that's a kilowatt-hour.
A customer service charge of $8 per month will be in place for all alternating current, single or three phase nonresidential electrical service, or commercial, customers.
In addition, those customers will pay a power charge of $9.71 per KW over 5 KW and an energy charge. The energy charge will be $0.1154 per KWH for the first 500 KWH, $0.0523-cents per KWH and $0.0374 per KWH for all remaining KWH.
A large customer is identified as one purchasing alternating current, three phase service supplied at the city's available voltages through a single point of delivery. These customers, said McKnight, do not have their own substation but are served by the city system.
"This schedule is for all customers whose loads have exceeded 500 KW (kilowatt) at any time in the preceding 18-month period," said McKnight.
There will be a customer service charge of $45 per month, a power charge of $13.69 per KW, and an energy charge of $0.0265 per KWH.
"The rate is based upon the customer maintaining a power factor of 90 percent lagging, or higher, as determined by measurement," said McKnight. "If the power factor is found to be less than 90 percent lagging, the power as recorded by the utility's meter will be increased by three-quarters of 1 percent for every 1 percent that the power factor is less than 90 percent."
There is also a high voltage rate which is reserved for those using alternating current, three phase service supplied at 46,000 volts nominal, through a single point of delivery.
"The high voltage rate is for those who have their own substation," McKnight said.
The customer service charge is $50 per month, with a power charge of $13.69 per KW and an energy charge of $0.0255 per KWH.
The customer also receives the rate dependent on the power factor of 90-percent lagging.
However, this customer is required to place on deposit with, or provide an approved payment bond, to the city for the equivalent of two month's estimated usage. The deposit will be adjusted after sufficient usage history is recorded.
There is also an irrigation rate for alternating current, single or three phase service through a single point of delivery as used for irrigation purposes.
The monthly customer service charge is $12 with a power charge of $13.69 per KW and an energy charge of $0.036 per KWH.
This rate is also based on the power factor of 90 percent lagging, or higher. If the power factor is less than 90 percent, then the three-quarter of 1 percent is charged.
"The council needs to make a choice to raise rates in order to keep those electric rates healthy," said McKnight.'
Greg Rowley, council member, said that the city also had a large deficit in the power category. In addition, the power rates have not been changed in 34 years.
For those reasons, he thought the rates should be changed in order to provide quality service and a sound budget to the city's citizens.
"It costs us $4 per KW to produce power," said Blair Painter, city recorder.
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