The Turlock Irrigation District Board of Directors is expected to vote on the proposed 2 percent system-wide increase for electricity customers on Dec. 9, following the public rate hearing held Tuesday.
TID staff has proposed and recommended an approximately 2 percent increase for nearly all 98,000 electricity customers in the district to help offset a projected $17 million revenue shortfall.
Proposed rate increases would come into effect on Jan. 1, 2015 if approved by the TID Board of Directors.
Along with the proposed 2 percent increase — which was originally 5 percent — approximately $7 million of a rate stabilization fund, which holds around $69.2 million, and $4 million due to changes to the Power Supply Adjustment will be used to make up for the shortfall.
The 2 percent rate increase represents the other $6 million of the $17 million projected shortfall.
Customers will experience increase in energy, demand, and customer base rates, according to TID staff, if the proposed increase is approved.
Rate increase percentages are as follows:
- Residential Customer (DE) would see an increase of 1.5 percent.
- Small Commercial Non-Demand & Non-TOU (CE) customers would see an increase of 1.2 percent.
- Small Commercial TOU (CT) customers would see an increase of 1.5 percent.
- Large Industrial (HT) customers would see an increase of 3.7 percent.
- Municipal Demand (MD) customers would see an increase of 3.8 percent.
- Municipal Connected Load (MC) customers would see an increase of 3.8 percent.
- Restricted Irrigation Pumping TOU (PT) customers would see an increase of 4 percent.
- Restricted Irrigation Pumping (PI) customers would see an increase of 4 percent.
- Farm Energy (FE) customers would see an increase of 1.7 percent.
- Farm Demand (FD) customers would see an increase of 2.3 percent.
- Farm TOU (FT) customers would see an increase of 2.9 percent.
- Small Industrial TOU (IT) customers would see an increase of 2.4 percent.
- Small Industrial Demand (ID) customers would see an increase of 1.6 percent.
- Very Large Industrial TOU (XT) customers would see an increase of 3.7 percent.
- Bulk Power Industrial Service (BP) customers would see an increase of 4 percent.
In addition to the rate changes, TID staff also proposed closing three farm account types, Farm Connected Loads (FC), Farm Irrigation Pumping (FO), Farm Irrigation Pumping (FX). FO and FX account types have been closed to new customers since the early 1990s and the number of customers still under these accounts is down to 106; there were around 3,500 FO and FX customers in 2002.
There are still approximately 690 customers under FC accounts, something that Director Joe Alamon should be taken into account while closing these accounts out.
“That’s a pretty large number,” said Alamo. “It seems as though you closed the FO and FX over the course of a 10 year time frame, would that be wise to do with the FC? Just don’t let any new customers in and dwindle them down.”
Transitions for customers would occur over a year, with customers moving to FE, FD, or FT rates by Dec. 31, 2015. TID would inform all affected customers of the change and customer service would contact each to offer rate information.
FC, FX, and FO customers would not experience a rate increase at the Jan. 1, 2015 date.
TID customers on the westside of the district, which includes Patterson, Crows Landing, and Diablo Grande, would also not experience the same rate increases as eastside customers; many customers would actually see a noticeable decrease from current rates.
In 2003, TID acquired the westside system from Pacific Gas & Electric and westside customers have been paying additional charges to cover the the acquisition costs.
TID staff anticipates the acquisition will be paid off by early 2015.
Residential customers would see a customer charge increase from $11 to $17, while commercial customers would go up from $8 to $25.
Despite the proposed fixed charge increases, staff says the rates will still remain in the ballpark of other districts.
TID’s residential and commercial charges are both currently lower than Modesto Irrigation (MID) and Sacramento Municipal Utilities (SMUD) districts. MID and SMUD both have proposed residential charge increase to put them at $20 and $16, respectively. The proposed commercial increase would however make TID customers paying more than both MID and SMUD customers.
Although the public rate hearing was held to allow customers to make public comments on the proposed rate increase before the vote, very few members of the public made comment; most of those in attendance were there for the public rate hearing on the changes to TID’s solar rates.
“If there is another rate increase, what does it solve?” asked Nick Hackler, who added that he has experienced 12 percent increases over the last three years. “You mentioned a $17 million shortfall, isn’t TID sitting on, based on what I’ve heard and read, a $60 million reserve. If so, what does 2 percent or 10 percent solve?”
Staff, nor the Board, did not answer Hackler’s question, but staff has previously said that depleting the fund is not necessarily an option as it acts as backing to attain lower interest rates should bonds be needed.
The TID Board of Directors will vote on the proposed increases on Dec. 9.
“It is the Board’s prerogative however to take any action on rates they see fit so, they can implement all or part of the changes, or none at all,” said TID spokesperson Calvin Curtin.
If the any of the proposed increases are approved, they will be implemented on Jan. 1, 2015.
The Board of Directors will also vote on some changes to solar caps and rate changes on Dec. 9. Both votes will occur at the regularly schedule TID Board meeting at 9 a.m. Tuesday in the Board Room of the TID Main Office Building, 333 E. Canal Dr.