BURLEY | The Burley City Council will consider a 3.5 percent increase in electric rates to keep pace with increases from Bonneville Power Administration.
This year the city will pay an additional $519,000 to BPA for the same amount of electricity customers used last year, said Brent Wallin, head of the city’s electric department.
The city approved a 4.3 percent rate increase in October, which still leaves the city’s coffers short $233,000.
A 3.5 percent increase will raise the average residential customer’s bill by $4.32.
Wallin said the city was forced to sign 20 year contracts with BPA in 2010. BPA evaluates each city’s rates and their costs every two years and makes adjustments.
“So far every two years we’ve had increases from them,” Wallin said. “Maybe I was a little naïve at first, but I think we have a grasp on that now. We will have increases from them every two years.”
Based on BPA’s estimates on increases through 2030 when the contract expires, rates will have almost doubled from the beginning of the contract.
“It’s actually scary to me,” Wallin said.
City Administrator Mark Mitton said the electric department has done everything possible to cut expenses, including laying off temporary employees and reducing inventory.
The department went from having four journeymen linemen on staff to three apprentice linemen and one lineman, Wallin said.
Burley City Councilman Jon Anderson asked if Wallin knew how the city’s rates compared to its neighbors.
Burley’s rates are the highest after Rupert. United Electric and South Side Electric rates are lower, and Heyburn has the lowest rates.
“Are those (cities) in our direct market in denial?” Council President Randy Hawkins asked.
Wallin said BPA never shares information on other customers with the city, but the city is part of a conglomerate of electric users where that information was shared.
In the future, Mitton said, the city might have the option of finding other sources of energy that can be mixed in with BPA purchases if the rates become too high.
“As of yet it hasn’t been cost-effective to use that option,” he said.
The Council will deliberate on the rate increase at the next city business meeting at 7 p.m. Tuesday. The meetings are held at City Hall.
Be the first to know
Get local news delivered to your inbox!