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EAA and your utility bill

Editor’s Note: The City of New Ulm presents a weekly column highlighting activities in different departments in the city government. Once a month the city will answer questions from readers. Questions on New Ulm city issues can be sent to comments@ci.new-ulm.mn.us.

You may be saying, “I think I understand my utility bill, but what are these electric acquisition and purchase gas adjustments?” The New Ulm Public Utilities buys its electric energy and natural gas off the commodities market to supply the end user (our customers). Just like any market i.e. corn, gold or oil, the price can fluctuate on a month to month basis. The utility uses the adjustment to reconcile the market price to the base price in our published rate for the electric, natural gas, steam utilities. By making this adjustment, the Utility will have adequate cash to pay for the electric and natural gas commodities and the customer avoids having a base rate adjustment each year.

The Energy Acquisition Adjustment (EAA) is calculated for electric rates on an annual basis. The EAA is calculated using the projected fuel and purchased power costs for the year as determined by our budget. The energy charge is increased or decreased by the projected annual cost of energy purchased from our suppliers. For example, for 2016, we have estimated that the electric energy purchased from our suppliers will average .07105 cents per kilowatt hour (kwhr), so that produces a .01256 cent EAA on the utility bill because our base commodity charge in our published rate is .05849 cents per kwhr. The Utility reserves the right to modify the adjustment at any time during the year if the actual purchased rates per kwhr vary significantly from the estimate. New Ulm customers have not seen a rate increase in their electric rates since September of 2012 and the energy adjustment acquisition was actually reduced in 2015 from 2014 levels.

The natural gas and steam adjustments are calculated on a monthly basis. This adjustment is handled similar to the electric adjustment (EAA). The calculation is based on the monthly purchased gas from our supplier which includes commodity and transportation costs. The usage charge for all gas billed to customers is increased or decreased by the amount that the actual purchased gas rate exceeds the base rate of .6142 cents per centum cubic feet (ccf) of gas which is built into our rates. The steam fuel cost adjustment is handled the same way as the gas adjustment and is based on the purchased gas pricing from our supplier since gas is the commodity used to produce steam. The natural gas rates have not had a rate increase since February of 2006 however there have been negative and positive purchased gas adjustments on a monthly basis. The steam rates were adjusted in February of 2013.

The New Ulm Public Utility strives to maintain reliable service with stable rates for our customers. If you have any question with regard to the adjustments on the billing, you can call our billing office at 507-359-8259.

EAA and your utility bill

Editor’s Note: The City of New Ulm presents a weekly column highlighting activities in different departments in the city government. Once a month the city will answer questions from readers. Questions on New Ulm city issues can be sent to comments@ci.new-ulm.mn.us.

You may be saying, “I think I understand my utility bill, but what are these electric acquisition and purchase gas adjustments?” The New Ulm Public Utilities buys its electric energy and natural gas off the commodities market to supply the end user (our customers). Just like any market i.e. corn, gold or oil, the price can fluctuate on a month to month basis. The utility uses the adjustment to reconcile the market price to the base price in our published rate for the electric, natural gas, steam utilities. By making this adjustment, the Utility will have adequate cash to pay for the electric and natural gas commodities and the customer avoids having a base rate adjustment each year.

The Energy Acquisition Adjustment (EAA) is calculated for electric rates on an annual basis. The EAA is calculated using the projected fuel and purchased power costs for the year as determined by our budget. The energy charge is increased or decreased by the projected annual cost of energy purchased from our suppliers. For example, for 2016, we have estimated that the electric energy purchased from our suppliers will average .07105 cents per kilowatt hour (kwhr), so that produces a .01256 cent EAA on the utility bill because our base commodity charge in our published rate is .05849 cents per kwhr. The Utility reserves the right to modify the adjustment at any time during the year if the actual purchased rates per kwhr vary significantly from the estimate. New Ulm customers have not seen a rate increase in their electric rates since September of 2012 and the energy adjustment acquisition was actually reduced in 2015 from 2014 levels.

The natural gas and steam adjustments are calculated on a monthly basis. This adjustment is handled similar to the electric adjustment (EAA). The calculation is based on the monthly purchased gas from our supplier which includes commodity and transportation costs. The usage charge for all gas billed to customers is increased or decreased by the amount that the actual purchased gas rate exceeds the base rate of .6142 cents per centum cubic feet (ccf) of gas which is built into our rates. The steam fuel cost adjustment is handled the same way as the gas adjustment and is based on the purchased gas pricing from our supplier since gas is the commodity used to produce steam. The natural gas rates have not had a rate increase since February of 2006 however there have been negative and positive purchased gas adjustments on a monthly basis. The steam rates were adjusted in February of 2013.

The New Ulm Public Utility strives to maintain reliable service with stable rates for our customers. If you have any question with regard to the adjustments on the billing, you can call our billing office at 507-359-8259.

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