In one way or another, Independence Council Member Mike Huff says, “we will succeed” in reducing Power & Light electric rates.
His proposed first step is a resolution authorizing recommendations from the 2015 cost-of-service and rate study done by Sawvel and Associates, which the council tabled.
That study included simplified industrial and commercial rate structures – leading to a 2 percent rate reduction – and a fixed cost to replace a minimum bill. According to the city, potential savings for those customers would be about $3 million.
The Public Utilities Advisory Board will hear Huff’s proposed resolution at today's meeting, and it will then be on Monday's City Council agenda.
Huff said Independence has lost out on some potential industrial and commercial customers, is in danger of possibly losing more and generally has trouble attracting new large business because of high electric rates. A stronger base of large-scale electric users could allow the city to alleviate residential rates.
“They've got the biggest burden,” Huff said of industrial and commercial customers. “We do this effective immediately, then (later) reduce residential rates.”
“Everyone needs to be patient. This is the first step to making it right for the citizens.”
Huff said he believes he has enough council support to get the resolution through. Ideally, he would have wanted to propose a notable across-the-board decrease, but such a move is not financially feasible feasible. Instead, he hopes the city can phase in residential rate reductions next year.
Burns & McDonnell is finishing another cost-of-service and rate study for the city, with preliminary results due by the end of the year. Huff, who joined the council earlier this year, said he believes that study will mirror the Sawvel 2015 study in many ways. After study was released, a Sawvel employee told the city it was in a unique position because of the utility’s cash reserves and its ability to potentially lower rates.
“I'm trying to help us get a jump-start (on reducing rates),” Huff said.
Such a move would be rare among municipally owned utilities, he said, if not unprecedented locally.