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The Utilities Department’s plan to raise Palo Alto’s electricity rates by 10 percent, while also trimming 10 percent off the city’s natural-gas rates, will face its second major test tonight (Tuesday) when the City Council’s Finance Committee is scheduled to debate the proposal.
The Utility Advisory Commission discussed the department’s plan earlier this month, at which time members backed staff’s proposals to drop natural gas rates and to raise the water and wastewater rates by 5 percent each.
The commission failed to reach a consensus on the electricity rates and refrained from issuing a recommendation on the proposed spike, which city officials attributed to California’s drought conditions.
The full City Council is scheduled to discuss the proposed rate adjustments in June. The new rates would take effect July 1.
City officials estimate the next impact of all rate adjustments to be a 1.4 percent increase in the utility bill of an average residential customer.
Utilities staff estimated that the new natural-gas rate would trim $17.07 off an average residential bill in the winter and $5.51 in the summer. The average monthly residential bill under the proposed rates would be $146.26 in the winter and $52.59 in the summer, staff projected.
Staff plans to drop the natural gas rates because of the decreased cost of natural gas in the wholesale market, offiials reported.
But even after the rate adjustment, staff couldn’t say how Palo Alto’s gas rates would compare to those of PG&E, which supplies gas to neighboring communities. The average Palo Alto residential customer currently pays about 38 percent more for natural gas than a PG&E customer in neighboring communities, according to a recent staff report. But because PG&E rates tend to fluctuate rapidly, the department could not predict how the rates would compare months from now.
Meanwhile, a 10 percent increase in electricity rates would raise an average residential bill by $6.97, bringing it up to $76.33, according to staff estimates. The electricity rate would remain 22.8 percent below PG&E, staff has projected.
City officials attributed the water-rate increases to the ongoing effort by the San Francisco Public Utility Commission to upgrade the regional water system, which supplies Palo Alto.
“We aim for a fair balance of cost efficiency with environmentally sustainable choices,” Jane Ratchye, the city’s assistant utilities director for resource management, said in a press release.
The city also plans to raise its refuse-collection rate by 17 percent, an adjustment that staff estimates would add about $4.44 to an average bill. The increase reflects the city’s goal of diverting 90 percent of its waste from landfills and will pay for closure and post-closure landfill costs, equipment retooling at the waste-transfer station in Sunnyvale and conversion to a new billing system, city officials announced.
“As a community, if we don’t take the appropriate actions to curb our environmental impact now, we might see larger increases in the future due to climate change,” Public Works Director Glenn Roberts said.
The Finance Committee will meet at 7 p.m., Tuesday, March 31, at the Council Chambers in City Hall, 250 Hamilton Ave.
I don’t see a debate here. Sounds rather incestuous, all City people involved. Who is speaking for the residents?
Nothing to debate here anyway. Its a stupid idea to raise rates. Give with one hand and take away with the other. We don’t need Jethro’s cipherin’ to see that’s no break at all!
Sell the utilities to PG&E or Calpine, or even to Santa Clara, where the utility is treated like a business, not an instrument of change.
In fact, why not contract with Silicon Valley Power to manage our utilities for a fee?