The good news: The Omaha Public Power District plans to charge customers no more for electricity in 2019 than in 2018 or 2017.
The bad news: Some will pay more, because January brings the final $5 monthly fee increase for the fixed-cost portion of residential bills.
Monthly fixed fees have risen roughly $5 a year since 2015 to shift more of the utility’s costs onto all of its customers, regardless of how much power they use. Monthly set fees for residential customers will hit $30 a month.
Still, OPPD says residential customers who pay between $80 and $125 a month shouldn’t pay more for their total electricity bills next year. That’s because OPPD has lowered the variable portion of electric bills as it has raised the fixed fees, shifting some costs from the rates to fees.
The fixed cost portion of bills will rise to $30 in 2019 from $10.25 in 2015, while OPPD says the amount it charges customers in the variable portion of their bills will have fallen by about 22 percent since 2015.
OPPD has said it needed to increase its fixed fees because as people use less electricity, the utility still must bring in revenue to cover the costs of piping electricity to homes and businesses and maintaining the system.
The fee is meant to recover the costs of meters, transformers, service lines and general distribution of power, OPPD President and CEO Tim Burke said. He said he does not expect to pursue an increase in the fee in 2020.
Fixed cost increases often hit lower-income customers, even if they’re small users of electricity. To deal with that, in 2015 OPPD set up an assistance plan. Nearly 18,500 residential accounts of the more than 374,000 customers serviced by the utility have qualified for the credit, OPPD spokeswoman Jodi Baker said. The program is funded through May 2020.
Outgoing board member Tom Barrett, who represents northeast Omaha, asked OPPD management whether they had done the research to verify their prediction that most customers would pay the same or less under the new rate structure. Management officials said they had not yet done so.
The OPPD board plans to vote on the public utility’s $1.2 billion 2019 budget during its board meeting at OPPD’s downtown headquarters at 4 p.m. Thursday, at which it also will take public testimony. The utility discussed the basic outlines of the budget Tuesday.
Key among its expenditures is a $12 million increase in the utility’s reserve fund for shuttering Fort Calhoun Nuclear Station. OPPD says the increased spending will save millions of dollars in the end by allowing the utility to decommission the plant years sooner than planned.
OPPD spent $300 million to get the nuclear plant back up and running after the 2011 Missouri River flooding crippled the plant. In 2016, the utility decided to close the plant.
OPPD’s capital spending budget is set to increase to $200 million in 2019, up from $140 million this year, said Javier Fernandez, the district’s chief financial officer. That increase is being driven by a list of projects, including $18 million for a new substation planned for southwest Omaha and funds being set aside for replacing traditional high-pressure sodium streetlights with LEDs.
The budget also includes an additional $2 million for tree trimming. OPPD management said their information shows a savings to the utility and its ratepayers by trimming more trees before they cause costly outages.
Retail sales locally are budgeted to increase by more than 3 percent in 2019, driven primarily by population and business growth.
But some planned power plant outages for maintenance, including at OPPD’s coal plant in Nebraska City, are helping drive a budgeted decrease in wholesale sales, decreasing the energy sold by about 10 percent.
