Why did NTUA seek an Electric Rate Increase?
First of all, we do not like having to increase the price of utilities. We understand that paying more is difficult for all of us; however, the revenue coming in today unfortunately is not enough to cover expenses for day-to-day operations, including purchasing materials and supplies in order to provide the necessary upkeep of our electric utility system. We have strived very hard to keep utility rates at the lowest cost possible. We should have adjusted all the electric utility rates three to four years ago. Instead, NTUA began to look at alternatives to become more cost effective in running operations. However, that formula isn’t working anymore as we meet rising prices everyday. We work hard to control internal costs, yet the cost of conducting business is continually impacted by high cost of fuel, materials, equipment and human resources. Rising costs are everywhere and affect everyone. We see higher prices at the grocery stores and certainly at the gas stations. Inflation continues to hit everyone’s wallets, including NTUA’s.
Different increase for all customer classes
This chart illustrates how the electric rate increase will affect each customer class. On average, a residential household which uses 500 kilowatt hours, the customer bill is approximately $36.00 per month. With the new rates, the cost will increase $6.75, totaling $42.75.
NTUA recognizes that an electric rate increase could place a burden on our Senior Citizen and Life Support customers. NTUA currently offers a seven percent discount to qualifying Senior Citizen and Life Support Customers. With the new electric rates, the current $3.00 service charge will be waived and the discount increased from seven percent to 10 percent.
How your dollar is spent at NTUA We as customers want to be informed on how our money is spent. This illustration shows how our dollar is used by NTUA. Like all our customers, NTUA receives an electric bill every month from outside power companies. NTUA purchases electrical power and transmits and distributes that power throughout the service area. NTUA pays .52 cents of every dollar to purchase electric power. NTUA uses 28 cents of every dollar for operation and maintenance of the electrical utility system. Operation and maintenance cost includes materials, supplies, equipment, labor, and overhead. These are costs incurred to maintain the electric infrastructure throughout the service area. NTUA also applies 16 cents for capital improvements (new sub-stations, line extensions, pole replacements, vehicles and large equipment). NTUA also pays 4 cents to repay loans we have acquired over the past 20 years. NTUA obtains loans through the Rural Development Utilities Program to supplement capital improvements throughout the service area.
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the service area. NTUA also applies 16 cents for capital improvements (new sub-stations, line extensions, pole replacements, vehicles and large equipment). NTUA also pays 4 cents to repay loans we have acquired over the past 20 years. NTUA obtains loans through the Rural Development Utilities Program to supplement capital improvements throughout the service area.