Rate increase to boost reliability

-A A +A

Rate hike may be costly, but officials says it’s necessary to stop rash of outages

By Kirsten Laskey

Everyone in Los Alamos can attest to the mixed behavior of the county’s electricity.

Perhaps no one knows this situation more than the residents on North Mesa and Barranca Mesa — where outages are routine.

“Those particular overhead lines are over 40 years old and the conductor is undersized (and) prone to outages during wind storms,” Department of Public Utilities Manager John Arrowsmith said.

Correcting the situation comes with a price.

The Los Alamos County Utilities Department will propose a 10-percent electric rate increase to county councilors during the Aug. 24 meeting.

The average cost per customer would be raised $5, Arrowsmith said.

Arrowsmith said part of the need for the rate increase request is to replace aging overhead circuits that cross North Mesa and Barranca Mesa. In conjunction with the Diamond Drive project, underground infrastructure is also being installed to serve these communities and the Western area.

Directly buried lines, or lines that do not have a conduit, were installed in neighborhoods during the 1980s and 1990s and may present problems since they are reaching the end of their 30-year life span. Having lines without a conduit is a concern because they are not protected.

Also behind the increase: the cost of power on the open market has jumped. According to the Board of Public Utilities staff report, the county’s cost of power has jumped by about 11 percent. This was driven by the 25-percent hike in the cost of market power and capital replacement costs of the San Juan Generating Station. Arrowsmith said that the San Juan Generating Station is approaching 30 years old so maintenance needs are increasing.

Despite  the rising expenses, Arrowsmith said a comparison of the Jemez Co-op, PNM and Nora revealed that the proposed increase would mean local residents would pay a rate 9 percent lower than the average of those agencies. Councilor Sharon Stover said although the rates are higher, they have not skyrocketed. The proposed rates are only 4 percent more than they were in 1992. She said rates were decreased in 1994 before 5 percent rate hikes were approved in 2007 and 2008.

“Within our region we are still the lowest, our rates aren’t as high as others and that includes PNM,” Stover said.

Bruce Norman, owner of Pajarito Plateau Property Management, said as a landlord who invests in his properties, he understands why the county is interested in putting money in the infrastructure.

“It may be something you just have to accept. If it’s legitimate needs, they have to pay for that somehow and that’s through a rate increase,” Norman said.  

Still, the increase is more than the county wanted to see, said Councilor Robert Gibson,  “but the bulk of the proposed increase is for enhanced emission controls at the San Juan Generating Station and  improvements to the local distribution system, to improve reliability. Both cleaner air and better reliability cost money.”

Residents responding to an online poll by the Monitor are not in favor of a rate increase. More than 87 percent of 141 resondents — 123 — said they did not believe the proposed 10-percent increase is justified. About 12 percent, or 18 residents expressed support for the increase.