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LPEA to boost rates

The La Plata Electric Association (LPEA) Board of Directors gave preliminary approval Wednesday for an average electric rate increase of 3.3 percent.

Specific increases will depend on the rate classification of each residential, commercial and industrial customer. Residential customers will notice an increase of $2.20 per month.

LPEA must give at least a 30-day notice of proposed rate changes, and during that time will accept member comments to those proposed changes. The board is scheduled to give final approval in December, with the new rates to go into effect Jan. 1, 2012.

The board also gave preliminary approval to a 25-percent reduction in the premium for “Green Power,” or electricity generated from a renewable resource. Cost per 100-kWh block will drop from $0.10 (10 cents) to $0.075 (7.5 cents). The reduction is also slated to go into effect Jan. 1, 2012.

LPEA’s general rate increase is a direct result of the rise in the cost of wholesale power provided by Tri-State Generation and Transmission Association, from which LPEA purchases the bulk of its electric power.

“At LPEA we’ve reduced costs with use of new technologies, reduced some programs, refinanced some debt, and are now about as lean as we can get without impacting quality, reliable service to our members,” said Greg Munro, LPEA CEO. “We haven’t had a rate increase for three years, and we would have liked to absorb Tri-State’s increase in the power bill as we have in the past, but after crunching the numbers, to maintain all of our financial requirements, we estimate we’ll need an additional $3.2 million in 2012. That’s how we came up with the 3.3 percent average increase. We have forecasted as tight as we can and will still have to work hard in 2012 to find more savings.”

Tri-State’s rate increase is a direct result of increased costs in generating and transmitting electrical energy, including bringing on some significant renewable energy generation.

“Renewable energy is the positive side of the equation,” added Munro. “Tri-State continues to add renewable generation to its portfolio, plus with the increased demand, more is available for sale on the market, forcing the price to drop. We hope this decrease to 7.5 cents per 100 kWh block will encourage more of our members to sign up for Green Power.”

At the November meeting, the LPEA board also approved the 2012 Capital Projects Budget of $18,058,451 and the 2012 Capital Items Budget of $346,872.

A mandatory comment period during the required 30-day notice of rate changes will be observed prior to the LPEA Board’s final adoption of the new rate tariffs, which will take place at its next meeting on Dec. 19. Every effort is being made to inform co-op customers. The increases for each rate classification will be delineated in display advertisements in The SUN and online at www.lpea.coop.

For further information, call 247-5786.

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