Town Talk: Electrical rate increase approved

New Ulm Public Utilities Commissioners unanimously approved the proposed electric rate increase at their January meeting. The electric rate increase was based on a cost of service study. The cost of service study calculates the cost to provide service in each rate class. Rate classes include: Residential, Small Commercial, Large Commercial and Industrial.

All rate classes include an Energy Acquisition Adjustment charge. Residential and Small Commercial rates include an energy charge, based on the kilowatt-hours used, and a customer charge that is a fixed monthly fee. Large Commercial and Industrial rates include an energy charge, based on the kilowatt-hours used, a demand charge and a customer charge that is a fixed monthly fee.

Since 2012, New Ulm Public Utilities has been successful in preventing an electric rate increase. The cost to provide electric service and maintain our electrical system have continued to increase during that time. The rates have remained stable while our wholesale electricity supplier has increased energy rates by 28% and demand rates by 41%.

Residential rates will increase by 0.12 cents per kilowatt-hour (about a tenth of a penny), with an increase in the Customer Charge of $2.00 per month.

Small Commercial rates will increase by 0.44 cents per kilowatt-hour (about a half of a penny), with an increase in the Customer Charge of $2.00 per month.

Large Commercial rates will not increase for energy. The demand charge will increase by 60 cents per kW, with an increase in the Customer Charge of $5.00 per month.

Industrial rates will not increase for energy. The demand charge will increase by 10 cents per kW, with an increase in the Customer Charge of $20.00 per month.

The Energy Acquisition Adjustment charge will increase from 1.256 cents to 1.517 cents per kilowatt-hour for an increase of 0.261 cents (about a quarter of a penny).

The approved rates will be implemented in March. The new rates will first appear on the April bill for March electricity use. The average residential customer is expected to see a monthly increase of approximately $4.43 per month.

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