IID debates raising rates to pay for higher than expected electrical costs | News


EL CENTRO — Jaimie Asbury, Imperial Irrigation District energy manager, asked for an amended budget increase of over $15 million to bridge the gap between actual and forecast energy costs at the August 2 IID board meeting. She said actual increased market costs, the Yucca unplanned outage and higher than forecasted customer energy demand spiked expenses and overshot the budgeted allotment. Asbury called the circumstances a “perfect storm.”

IID Director Javier Gonzalez posed the question, “Where will the money come from?”

The budget increase will be collected through the Energy Cost Adjustment (ECA) billing factor,

according to Asbury.

The ECA is charged on to customer’s electric bill’s base rate. The directors recently set the ECA rate higher during the cooler months and lowered the rate during the summer to keep ratepayers from experiencing spikes in summer electric bills and to help pay for high priced, scarce summer energy.

“This has given me more concern than the (Colorado) River issues at this point,” Director JB Hamby said. “We’ve been under-collecting and now will have a 217% dramatic increase. This is going to be painful.”

Besides the higher than expected electricity use and the US southwest all chasing the same limited power, the breakdown of the aging Yucca Power Plant was one of the main factors of having to buy expensive outside power.

General Manager Henry Martinez said the IID has many facilities that are at the end of their life, are fragile, and the IID has been trying to keep them running at minimal expense, but some must be replaced. “We squeeze as much as we can from the old units.”

IID President Jim Hanks asked how much the ECA had collected since the district instituted the sliding rate. The answer was between $80 and $100 million.

“These expenditures could have been spread out over 30 years if we had built, but it will now be on the backs of clients in one year,” Hanks said. “When an old vehicle costs more to keep running than a new one, then you replace it.”

Martinez said new generating plants range from $150 -$200 million.

“If we look to replacements, we need ones that don’t use a lot of water. We must have something that uses dual fuel. We would want natural gas, but California may ban that,” Hanks said. “We need something we can eventually convert to hydrogen.”

Director Alex Cardenas asked for the ECA rate to be brought back at the next meeting to set it at a rate people can pay. The Rate Stabilization Fund was also mentioned as a way to fund the increase. Eric Reyes said during public comments that it held $66 million that belonged to the rate payer when IID overcharged previously.

The increased budget amendment was approved with a 3-1 vote, with Hanks casting the sole nay and Director Norma Galindo was absent.

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