News Release News Release The City of Palo Alto
Communications Department
650-329-2607
250 Hamilton Ave
Palo Alto, CA 94301

3/3/2009

FOR IMMEDIATE RELEASE
PRESS RELEASE UTL030309
Subject :

New Rates Expected, but No Change for Average Utility Bill
Contact : Valerie Fong, Director of Utilities, Utilities Department    (650) 329-2277
    Valerie.Fong@cityofpaloalto.org
Jane Ratchye, Assistant Director for Utilities, Utilities Department    (650) 329-2119
    Jane.Ratchye@cityofpaloalto.org
The Utilities Advisory Commission will discuss proposed rate adjustments for electricity, natural gas, water and wastewater collection services tomorrow (March 4) at 7 p.m., in the Council Conference Room. The proposed rate adjustments, submitted as part of the proposed 2010 budget process, are a 10 percent increase for electric, a 10 percent decrease for gas and a 5 percent increase for both water and wastewater collection.

New Rates Expected, but No Change for Average Utility Bill

The Utilities Advisory Commission will discuss proposed rate adjustments for electricity, natural gas, water and wastewater collection services tomorrow at 7 p.m., in the Council Conference Room. The proposed rate adjustments, submitted as part of the proposed 2010 budget process, are a 10 percent increase for electric, a 10 percent decrease for gas and a 5 percent increase for both water and wastewater collection. The net impact of these adjustments is expected to be almost no change in the total utility bill for the average residential customer, as declining gas rates account for the largest cost item in most customers’ utility bills.

Lower gas rates are possible due to lower wholesale gas prices. The City’s gas utility is also deferring a major capital project originally planned for 2010. As a result, gas costs are reduced, and the 2010 rates will reflect this relief. 

The necessary increases in electric, water and wastewater are due to higher purchase costs. Electric costs were impacted by drought conditions in 2007 and 2008, which reduced the amount of low-cost hydroelectric power available to the utility. Wholesale water costs were affected by the San Francisco Public Utility Commission’s program to rebuild and repair the regional water system. This essential program reinforces the water delivery system to Palo Alto in event of earthquake allowing for a continued safe, clean water supply. Ongoing cost increases for wastewater treatment impacted the cost of sewer services.

The table below shows the impact of the new rates on an average monthly residential bill during the high usage winter season. The table shows that the new rates will have almost no impact on the total bill.  

Impact on Bill from Proposed Rate Adjustments

Utility

Average Monthly Use

Current Bill

Proposed Bill

Bill Change

% change

Gas

 

 

   summer - 30 therms

$58.10

$52.59

-$5.51

-9.5%

   winter - 100 therms

$163.33

$146.26

-$17.07

-10.5%

Annual Average

$110.71

$99.42

-$11.29

-10.2%

Water

14 CCF

$68.79

$72.01

$3.22

4.7%

Electricity

650 kWh

$69.36

$76.33

$6.97

10.0%

Wastewater

flat rate

$23.48

$24.65

$1.17

5.0%

Total

Based on Average Natural Gas Usage

$272.34

$272.41

$0.07

0.0%

“We’ve done what we can to reduce our operating costs and keep the rate proposals as low as possible. In addition to keeping costs down as much as possible, we want to work with customers to help them manage their energy and water usage and thus their utility bills,” said Jane Ratchye, the City’s Assistant Utilities Director for Resource Management.

What Customers Can Do to Lower Their Bills

Focus on Energy Efficiency: City of Palo Alto Utilities offers many sustainable ways for Palo Alto residents to reduce their utility bill. Get tips on reducing your energy use. For more information on energy efficiency, please visit
www.cityofpaloalto.org/resrebate

Receive a Customized Energy Audit: Use the online Home Energy Analysis and find new ways to save energy. For more information on the Home Energy Analysis, please visit www.cityofpaloalto.org/energyaudit

Receive Rebates: Change to Energy Star rated appliances and get rebates. For more information on the SMART Energy Rebate Program, please visit www.cityofpaloalto.org/smartenergy

Sign Up for RAP & REAP: Eligible low or fixed income customers can save up to 20 percent on their energy bill by using the utility’s discount program, the Rate Assistance Program (RAP), and free energy efficiency program, the Residential Energy Assistance Program (REAP). For more information on these programs, please visit www.cityofpaloalto.org/lowincome

The Council Finance Committee will consider the proposed rate increases at its meeting on March 31, 2009. This is an opportunity for the public to hear the justification for the proposed rate increases and to let the committee hear concerns from members of the community. The Council Finance Committee then forwards the recommendations to the full City Council for action as a part of the Fiscal Year 2010 Budget.  The Council takes final action in June 2009. If these rate adjustments are approved by the City Council this June, these adjustments will be effective July 1, 2009.

For more information on ways to keep your utility costs down visit www.cityofpaloalto.org/utilities or call 329-2241.

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Energy Efficiency Tips

1.       Keep the thermostat at 68o degrees or lower. Lower the thermostat to 55 o degrees at night or when you’re away.

2.       Use a programmable thermostat to turn on the heater a few minutes before waking up or coming home.

3.       In winter, set ceiling fans on slow to evenly circulate warm air.

4.       Use curtains to reduce drafts. Open window shades during the day to benefit from the heat of the sun and close them at night to keep the heat in.

5.       Purchase a new heating system; it is more cost-effective than making major repairs to an old one. Look for ENERGY STAR® certified systems. In winter, check all the filters and replace them monthly.

6.       Reduce your hot water use and save on the water, energy and sewer. Wash clothes in cold water, take five to seven minute showers and check your home for water leaks.



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