The Board of Aldermen meets Tuesday to consider the adjustment.
Here is the background information:
CITY OF NEW BERN BOARD OF ALDERMEN
WORK SESSION FEBRUARY 12, 2019- 3:00 P.M.
CITY HALL COURTROOM 300 POLLOCK STREET
Discussion and Consideration of Wholesale Electric Cost
INDIVIDUALS WITH DISABILITIES REQUIRING SPECIAL ASSISTANCE SHOULD CALL 639-7501 NO LATER THAN 3 P.M. THE DATE OF THE MEETING
ELECTRICITIES I N O R T H C A R O L I N A, I N C,
To: North Carolina Eastern Municipal Power Agency Board of Commissioners and Alternates
FROM: Kathy L. Moyer, Vice President, Operations
DATE: January 28, 2019
SUBJECT: DAY NOTICE OF NCEMPA WHOLESALE RATE CHANGE
The Board of Directors adopted, at its meeting on January 25, 2019, the following changes to NCEMPA’s wholesale power service rates based on the recommendations of the NCEMPA Rate Committee and the NCEMPA Board of Commissioners:
A 1.2% increase to Full Requirements rate effective April 1, 2019 through Full Requirements Bulk Power Supply Schedule FR-4;
Continued suspension of Rider 1 through September 2019 to retain the 2017 FRPPA true-up credit of $4.4M within working capital.
These changes were reviewed in detail by the NCEMPA Rate Committee at its meeting on January 10, 2019, and a summary of the information was presented to the NCEMPA Board of Commissioners at its January 23, 2019 meeting.
In accordance with the North Carolina General Statutes, Section 159B-10, the changes to the rate schedules adopted by the Board of Directors will become effective unless rejected within 30 days by the vote of 2/3 in number of the NCEMPA Board of Commissioners.
Thus, if the Board of Commissioners desires to reject the rates adopted by the Board of Directors, it must take action prior to February 27, 2019. If the Board of Commissioners takes no action, the rate schedule and riders adopted will become effective as noted.
Please contact me at (919) 760-6225 if you wish to discuss further these wholesale rate changes as adopted by the Board of Directors.
The attachments include an explanation of these rate changes together with marked copies of the rate schedule and riders listed.
cc: NCEMPA City Managers NCEMPA Utility Directors NCEMPA Finance Directors
North Carolina Eastern Municipal Power Agency Wholesale Power Service Rate Changes
Approved by the ElectriCities Board of Directors on January 25, 2019
The Board of Directors adopted, at its meeting on January 25, 2019, the following changes to NCEMPA’s wholesale power service rates based on the recommendations of the NCEMPA Rate Committee and the NCEMPA Board of Commissioners.
SUMMARY OF WHOLESALE POWER SERVICE RATE CHANGES:
A 1.2% increase to Full Requirements rate effective April 1, 2019 through Full Requirements Bulk Power Supply Schedule FR-4;
Continued suspension of Rider No. 1 through September 2019 to retain the 2017 FRPPA true-up credit of $4.4M within working
Each item is described in more detail below:
FULL REQUIREMENTS RATE REVISION
The Rate Committee met on January 10, 2019 to review updated cost projections for NCEMPA. The 2019-2023 DEP Production System Projections were generally in-line with previous projections reviewed in September 2018. Due to the net effect of the updated cost projections and to maintain target working capital levels, the Rate Committee recommends a 1.2% rate increase effective April 1, 2019. The Demand and Energy rates will be adjusted to align the FR rate structure with DEP’s updated cost projections. Beyond 2019, the rate path includes a projected 3.0% rate increase in 2020. The updated FR-4 rate is proposed to be effective April 1, 2019.
RIDERNO. l,FRPPA TRUE-UP CHARGE/CREDIT
The Rate Committee recommends continued suspension of Rider No. 1 through September 2019 to retain the 2017 FRPPA true-up credit of $4.4M within working capital. Rider No. 1 allows for the suspension and reinstatement of Rider No. 1 on a year-to-year basis upon the recommendation of Board of Commissioners and approval of Board of Directors. In September 2018, the Board of Directors approved suspension of Rider No. 1, keeping the $4.4M FRPPA true-up credit in working capital until the January 2019 Rate Committee meeting to provide for planning flexibility.
Effective: April 1, 2012.&
NORTH CAROLINA EASTERN MUNICIPAL POWER AGENCY MEMBER ELECTRIC RATE SCHEDULE
FULL REQUIREMENTS BULK POWER SUPPLY SCHEDULE FR-
Service under this Full Requirements Bulk Power Supply Rate Schedule is applicable to all Members as defined in the Full Requirements Power Sales Agreement between North Carolina Eastern Municipal Power Agency (“Power Agency”) and its Members, dated as of April 24, 2015 (the “FRPSA”), and is subject to the provisions of the FRPSA and the Debt Service Support Contract between Power Agency and its Members, dated as of April 24, 2015 (the “DSSC”). This rate schedule, as supplemented and amended, is applicable for the sale of Full Requirements Bulk Power Supply, as defined in the FRPSA, for use and resale from existing facilities of adequate type and service. This rate schedule is applicable commencing with the billing month of April, 201&2. to be billed in May, 201&.2_.
. 2. FULL REQUIREMENTS MONTHLY CHARGES
Full Requirements Monthly Charges shall consist of the following Demand Charge and Energy Charge:
$ 22.4 per kW of Billing Demand Energy Charge:
2.530M94 ¢ per kWh of Billing Energy
DETERMINATION OF BILLING DEMAND AND BILLING ENERGY
Determination of Billing Demand
Billing Demand for each Member shall be the average kW measured at the Delivery Point, as such term is defined in the FRPSA, in the 60-minute interval during the current billing month, which is coincident with Duke Energy Progress’s (“DEP”) Monthly Peak Demand, as such term is defined in the Full Requirements Power Purchase Agreement between Power Agency and DEP, dated as of September 5, 2014 (the “FRPPA”), less any capacity allocation, in kW, from the Southeastern Power Administration (“SEPA”) at such point of delivery, but not less than zero.
2,Determination of Billing Energy
Billing Energy shall be the total energy measured during the current billing month at the Delivery Point, in kWh, less any energy allocation, in kWh, from SEPA at such point of delivery.
Pursuant to the FRPSA and the DSSC, the Monthly Bill will include the Full Requirements Monthly Charges, specified above, and amounts calculated in accordance with the applicable Rider(s) to this Full Requirements Bulk Power Supply Rate Schedule, which are incorporated herein and made a part hereof. Nothing in this Full Requirements Bulk Power Supply Rate Schedule shall be construed to prevent Power Agency from reviewing and amending this Rate Schedule or the Riders hereto and the charges contained herein from time to time.
Duke Energy crews are in the New Bern area to repair infrastructure that was damaged in December causing a widespread power outage.
A Duke Energy contractor was performing vegetation management services on Dec. 19 when a transmission line was severed leaving City of New Bern customers without power for about seven hours. A temporary fix restored power until permanent repairs could be made.
Duke Energy started making permanent repairs to the system on Monday The work is scheduled to be complete on by the end of February.
City of New Bern electric customers are not expected to experience any power outages or fluctuations in service during this time. If you do, contact Utility Control at 252-636-4070.
Utility Control is staffed 24 hours a day and allows the city to dispatch crews immediately in the event of a power outage.
When power is restored, reduce your consumption and save on reheating costs by adjusting your thermostat two degrees above the current temperature inside your home.
Once your thermostat reaches that temperature, continue increasing it by two degree increments until you reach your desired setting.
This will keep the heat strips from coming on. For example, if your thermostat says 62 degrees when the power comes back on, increase it to 64 degrees. When the temperature inside your home reaches 64 degrees, increase the thermostat to 66 degrees … and so on until you get back to your desired setting.
The City of New Bern will resume certain utility fees that were suspended during hurricane Florence.
Due to the storm’s widespread impact across our area, the Board of Aldermen unanimously agreed in September to temporarily suspend late fees, delinquencies and shutoffs for nonpayment. The Board also agreed to waive new deposits for current customers until mid-November. These actions effectively extended the due date of unpaid bills until such time that the City could recover from the hurricane.
All past due amounts must be brought current by close of business on Friday, Dec. 7. If customers are unable to get caught up or current, they are encouraged to visit the Utility Business Office (UBO) at 606 Fort Totten Drive and speak to a customer service representative about a special storm payment arrangement.
The UBO is open Monday through Friday from 8 a.m. to 5 p.m. No appointment is necessary. However, appointments are encouraged to reduce customer wait time.
These special storm payment arrangements will not count toward the four payment arrangements allowed each fiscal year under the City’s current business practices, but customers must remain current once the arrangement is made.
If the special storm payment arrangement is broken, the past due account balance must be paid in full. Attached is a document reflecting our business practices in regards to deposits and payment arrangements.
Late fees, delinquent fees and shutoffs for nonpayment will resume after Dec. 7. Deposit requirements will resume after Nov. 15. Deposits caused by late and delinquent actions will resume after Dec. 7.
The reinstatement of fees comes more than 80 days after hurricane Florence ravaged New Bern and eastern North Carolina.
“The Board of Aldermen and management staff have carefully considered this resumption of fees after the storm,” said Mark Stephens, City Manager. “We remain sympathetic to the hardships faced by our residents and are implementing special storm payment arrangements to ease the burden on our customers. We appreciate the community’s understanding during this recovery process.”
Utility staff are prepared to answer questions and assist customers with payment arrangements. As a reminder, customers have several options for paying City of New Bern utility bills: online at www.newbernnc.gov, at the Utility Business Office, and at Walmart stores in this area.
The city is easing penalties for late utility payments in the aftermath of Hurricane Florence.
“The effects of this hurricane will be felt for some time to come as flooding and winds have caused widespread damage,” the city said in a news release. “We have had several calls regarding payment of utility bills during this event and we are expecting many customers will be relocating from their flooded or damaged homes.”
To ease the burden on our customers during this difficult time, the following actions are planned:
1. Late fees and delinquencies will be suspended until further notice, effectively extending the due date of all unpaid bills until such time as the City has recovered
2. Shutoffs for nonpayment will also be suspended until further notice
3. While shutoffs for nonpayment will be suspended, the city is pulling meters and cutting service to damaged properties by order of the Building Inspector.
4. New deposit assessments typically required for current City of New Bern customers/residents and their immediate families (those living in the same household) will be temporarily waived until Nov. 15. All new customers/residents locating from outside of the immediate area will continue to follow the requirements. City of New Bern, NC Police Department City of New Bern Department of Public Utilities City of New Bern Community & Economic Development
TRASH PICKUP: Trash pickup for city residents will resume Tuesday. Contractors will begin with Tuesday’s route and resume each route each day. There will be no pickups for services lost in the last several days. If you have extra trash that does not fit in your receptacle, bag it and place the bag next to your receptacle streetside. No stickers are needed and there is no extra charge for these bags. Be aware that construction debris, carpets, clothing, etc. cleaned out from flooded homes should not go in your trash receptacle.
If you have an abundant amount of trash and want to dispose of it ahead of your trash pickup day, you may take it to a Craven County convenience site. However, the convenience sites will not open until Thursday, September 20. Craven County has confirmed that trash stickers will NOT be required.
Questions concerning trash pickup outside of the city limits of New Bern should be directed to your service provider.
DEBRIS COLLECTION: Contractors made it to our state Monday night and mobilzed for debris pickup. City staff and contractor crews will begin today picking up storm debris. Please put debris curbside but NOT in the street. Debris should be properly sorted into three piles: leaf/limb/vegetation in one pile. Construction debris (carpet, sheetrock, wood) in one pile. Brown good/white goods (furniture & appliances) in a third pile. Reminder: please place at the back of the curb, NOT in the street so as not to impede stormwater drainage. City staff & contractor crews will be working 12 hour shifts from 7am-7pm to collect debris. City residents may also take leaf/limb/vegetation debris to the city’s yard waste facility located at 1803 Country Club Road. This facility will operate Monday-Saturday from 8am-4pm until further notice. Or, you can take it to a Craven County convenience center beginning Thursday, September 20.
Questions concerning debris removal for residents outside of the city of New Bern should be directed to Craven County.
RECYCLING: Recycling is operated through Craven County. We understand recycling pickups will resume on Friday, September 21.
OUTSIDE CITY LIMITS: Regular Curbside household trash (with stickers) will begin Wednesday. If your pickup day is Tuesday it will be next Tuesday before it is picked up.
Editor: I read a letter regarding New Bern’s utility department (Sun-Journal, June 15) with keen interest.
The letter reminded me of those written by Billy Smith a few years ago. Smith, an avid preservationist and lover of New Bern, felt the city’s alder men and women’s ability to do anything right ranked below John Kennedy’s Bay of Pigs committee.
May I offer a response to the points raised in the recent letter.
The reward the city provides utility users who pay on time is negative — that is the shiny truck does NOT show up to shut off your meter — as it does for non-payment.
But the idea of a positive reward, as mentioned, intrigues me. More in a moment.
If bills are not paid utilities are still shut off. What was recently re-negotiated is the amount of deposit to have the power turned back on, how that deposit can be paid, and how long the city will hold that deposit before returning it.
(May I suggest that the city pay interest on these held deposits, which amount to an interest-free loan to the city.)
As the letter mentions, utility bills which remain unpaid and uncollectible are eventually written off. But I seen to remembers (then-) Mayor (Lee) Bettis saying at one time that these written-off accounts in any one year amounted to less than 1 percent of total utility revenues, hardly a heavy burden.
And city utility rates — the amount paid per kilowatt-hour — are higher than those paid by customers of Duke Energy. The city has long used utility revenues — in excess of costs — as a form of taxation to bolster general revenues.
Perhaps achieving parity with Duke Energy should be the next goal of utility reform. To achieve that goal I suggest the city develop its own field of solar panels, say in the unpopulated, sunny land between New Bern and Kinston.
In our modern world living without power, as suggested in the June 15 letter, is hardly an option. For those struggling financially from week to week, lower energy costs would be some small help.
And if that power came from renewables all the better; and all the more likely, if rates did drop, that bills would be paid.
On Alderman Sabrina Bengel’s motion and Alderman Jameesha Harris’ second, the board voted 4-3 for the revised policy, which states:
Per fiscal year, deposits will not be assessed on the first payment arrangement. Payment arrangements may be billed as installments. No late penalties or fees will be assessed if the payment plan is adhered to as agreed upon.
Per fiscal year, deposits will not be assessed for the first check returned for insufficient funds.
New customers may pay deposits in installments with 50 percent due at the time service is established and the balance payable over four billing cycles. Payment arrangements are not permitted until the deposit is paid.
New residential deposits shall not exceed $500.
Bengel, Harris, and Alderman Barbara Best drafted the policy revisions and were expected to vote for it. The only question was whether there would be a forth vote necessary to pass it.
But Best had new concerns about deposit refunds. At present, security deposits are returned after 18 months of good payments. Even with the revised policy, one payment arrangement would restart the 18 month period before the deposit is refunded to the customer.
Best argued that one payment arrangement should not prevent a customer from receiving a refund after one 18-month period.
Harris went the entire opposite direction. She said by reducing the security deposit to $500, it puts the city at further financial risk. She argued that security deposits should be returned only when a customer leaves the city.
Alderman Bobby Aster, a potential swing vote, questioned whether that would be fair, saying the city would then be holding onto deposits for years or decades.
Harris made the initial motion, which did not get a second, mainly because of wording issues.
Bengel made a second motion that would have allowed customers to have their security deposit refunded after 18 months even if during that time they had made one payment arrangement, provided they completed the payment arrangement during that 18 months.
Harris said she would not support that motion, saying the city should not refund security deposits except when a customer leaves the city.
Perhaps seeing an opportunity to stall the revision of a policy that he implemented during his first term as mayor, Mayor Dana Outlaw declared the two motions dead for lack of being seconded.
He suggested that the board wait before changing the policy. The city has not fully rolled out its advanced utility metering system or a program that allows customers to prepay their bills, he said. The city also has a new utilities director who has not had a chance to weigh in on the issue.
Alderman Jeffrey Odham agreed, saying that changing the policy would be jumping the gun.
Alderman Johnnie Ray Kinsey, who at first said he liked the Bengel/Harris/Best plan, agreed with Outlaw and Odham.
Undeterred, with Best’s permission, Bengel made another motion, this one free of any mention of deposit refunds, guaranteeing at least the three votes from the committee that drafted the policy revisions. That motion passed, 4-1, with Astor casting the deciding vote.
The financial impact on the city is that it puts up to $72,000 at risk if customers default.