The Rochester City Council unanimously approved a rate increase Monday of 3.5 percent for Rochester Public Utilities customers after months of discussion with the RPU Board and city officials.
In 2015, the average RPU customer will see an increase of about $3 per month, including a $1.50 customer charge increase. In 2016 and 2017, the rates will go up 1.7 percent, or about $1.50 per month. No increases are expected for 2018 and 2019.
"We think this is a pretty good way forward," said Council Member Michael Wojcik, who also sits on the RPU Board. "We gotta keep up with inflation, and these rates don't even keep up with inflation."
RPU General Manager Mark Kotschevar said the rate increases are to help the utility maintain good financial standing, such as keeping an adequate amount of reserve and cash on hand.
"I think (the rate increase) really strikes an appropriate balance between maintaining the financial health of the utility and" not impacting customers too much, he said.
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A study conducted by an RPU consultant considered an annual rate increase of 1.38 percent from 2015 to 2019, but that strategy didn't perform as well financially for RPU's needs, Kotschevar said.
There were no rate increases from 2010 to 2013, and the average rate increase from 2008 to 2017 will be 1.9 percent, according to RPU.
Council Member Mark Hickey said he doesn't like the way the city is now playing catch-up on utility costs after having no increases for so many years.
"My preference would be to see smaller increases more frequently," Hickey said. "(Customers) look at the percentage, and they look at what their paycheck is, and they're probably not seeing 3.5 percent increases.
The average RPU user consumes about 630 kilowatt hours of electricity per month, Kotschevar said. In order to have the same bill amount and not notice the increase, a user could conserve about 30 kilowatt hours less, totaling about $3, he said.
Some options for lowering consumption include unplugging phantom loads like computers and TVs, replacing old appliances or adjusting the thermostat, Kotschevar said.
"I think there's options that customers have," he said.
