A proposal to reduce residential electric rates and increase water rates is on the table for a special Public Utility Board meeting Tuesday.
With a proposed 2020 budget in hand, the board will take comments on the new rate proposals at 4 p.m. Monday in the Rochester Public Utilities community room, 4000 East River Road NE.
The recommendations call for lowering the basic residential charge for electricity from $19.50 to $18.30, but a 1.7 increase would be seen in the rate based on kilowatt hours — the amount of energy used by an individual household — to make the basic fee decrease revenue neutral.
The decrease in the basic rate follows a 1.9 percent increase last year and a 1. 5 percent increase in 2018. The rate increased by 3.7 percent in 2017.
This year’s decrease is partially attributed to a reduction in power costs for electricity from the Southern Minnesota Municipal Power Agency, according to a report prepared by Peter Hogan, RPU’s director of corporate services.
While the basic rate for electric service would drop next year under the proposal, the basic water rate would increase.
The proposed 3.5 percent increase follows three years of 6 percent rate increases.
The actual cost per household will depend on the current meter charge and rate of use.
Factors driving the proposed water rate changes reportedly include increased expenses related to replacing water mains and potential utility costs related to Destination Medical Center projects, which are being completed partially with dedicated DMC funds.
If the Public Utility Board approves the proposed rates on Tuesday, they will be reviewed by the Rochester City Council during its meeting at 7 p.m. Nov. 18 for final approval