Title
A Resolution Setting the Electric Cost Adjustment Effective September 12, 2014
Body
From:
Jerry Forte, P.E., Chief Executive Officer, Colorado Springs Utilities
Summary:
Colorado Springs Utilities is requesting a change to its Electric Cost Adjustment (ECA) rate. The current ECA rate of $0.0074 per kWh was implemented July 11, 2014. Current revenue and cost projections indicate that without a rate adjustment Colorado Springs Utilities could accumulate an over-collected balance of $10.2 million at the end of fiscal year 2014. To maintain financial stability and minimize the fluctuations associated with less frequent adjustments during periods of price volatility, Colorado Springs Utilities recommends an ECA rate change from the current rate of $0.0074 per kWh to a proposed rate of $0.0007 per kWh effective September 12, 2014.
Previous Council Action:
On July 8, 2014, by Resolution No. 62-14, City Council resolved to set the ECA at the current rate of $0.0074 per kWh effective July 11, 2014.
Background:
Colorado Springs Utilities sought approval for the current ECA rate at the July 8, 2014 City Council meeting. The ECA rate has remained at the approved level since July 11, 2014. As a result of restoration efforts at the Martin Drake Power Plant, Unit 7 is projected to be operating at full reliable capacity restoring the cheaper coal-fired power generation. In addition, record natural gas production levels and lower than expected summer demands have eased supply concerns in the forward gas market, reducing the projected cost of gas-fired and/or purchased power. Projections indicate that without an ECA adjustment the collected balance will be over-collected $10.2 million by the end of fiscal year 2014. Colorado Springs Utilities staff continues to provide regular updates to the Utilities Board on the collected balance, and will recommend timely changes to the ECA rate as is deemed appropriate.
Colorado Springs Utili...
Click here for full text