GLENWOOD SPRINGS – — Projected savings in Glenwood Springs electric utility costs next year will translate to a much smaller rate increase for electric customers than the city expects to see in its wholesale power rate.
Glenwood Springs City Council last week approved a 2 percent increase in residential and commercial electric rates. The new rate takes effect in July.
At the same time, the city is bracing for an estimated 20 to 25 percent increase in its wholesale electric power costs starting in 2013.
The city’s existing contract with the Municipal Energy Agency of Nebraska (MEAN) expires at the end of this year. A new 10-year deal starting in January 2013 will result in an estimated 25 percent increase in the city’s wholesale power rate.
The city is still exploring a possible 30-year contract with MEAN that would instead result in a wholesale rate increase of about 20 percent.
However, terms related to the city’s ability to use locally generated power need to be negotiated before the city could switch to the longer-term deal.
One reason electric customers won’t have to pay a comparable rate increase is that costs to run the city’s electric utility have been less than expected in recent years, Glenwood Springs City Manager Jeff Hecksel said.
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