Madison Daily Leader - Rate increases to appear on city utility bills

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Madison Daily Leader	home : news : news : top stories

Rate increases to appear on city utility bills

By CHUCK CLEMENT, Staff Reporter

11/23/2009

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Madison residents will have higher charges appear on their electricity and water bills starting in December after the city commissioners approved rate hikes during Monday's meeting.

Commissioner Dick Ericsson, who oversees utility-related business for the city commission, told the group earlier this month that typical residential-use rates would increase monthly bills from $70.96 to $77.76 for purchasing 800 kilowatt-hours. Those numbers indicate about a 10 percent increase for the cost of municipal electricity use.

Ericsson also told the commissioners that the water rate increase will boost monthly charges for 5,000 gallons of water used by a typical household from $21.09 to $21.97, about a 4 percent increase.

Mayor Gene Hexom said the city commission's actions reflected the wholesale electricity rate increases that the city's suppliers had enacted earlier this year.

Western Area Power Administration and Heartland Consumers Power District raised their wholesale electricity rates by 13 percent and 6 percent, respectively. WAPA and HCPD each provide about 50 percent of the electricity distributed by the Madison's municipal utility.

"Nobody likes to see rate increases, especially at this time with our current economy," Hexom said.

He noted that other municipal utilities in the state are taking the same action.

The commissioners had reviewed information at a previous meeting that showed WAPA needed to raise rates to pay off debt. The agency had borrowed money since 2000 due to a prolonged drought on the Upper Great Plains.

The agency's Missouri River hydroelectric dams had reduced power generation during the last decade, a situation that required WAPA to purchase electricity from the open market. Due to those purchases, WAPA accumulated about $1 billion in debt that the latest rate increase will help pay off.

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