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Utilities' forecast looks stable; regular rate increases projected

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By Kelly LeVan

A woman recently called the Los Alamos utilities department, concerned about a large bill. Ordinarily, she used about 4,000 gallons of water each month, but after her old, inaccurate meter was replaced, her total shot up to 18,000 gallons, or about $50. County Conservation Officer Matt Dickens came to her house to see what he could do.It turned out the extra 14,000 gallons had leaked from two constantly running toilets. He recommended a fix, after which her consumption – and bill – returned to normal.The Department of Public Utilities often deals with issues like the one above. Sometimes, it’s up to the customers to keep their costs down. But the Utilities Board also works to keep rates as low as possible. Customers’ and the county’s combined efforts become especially important when the department has a large project. In 2013, for instance, the San Juan-Chama diversion will be funded with a $25 million loan. The project includes a water treatment facility at Overlook Park, and should provide numerous long-term benefits, said Assistant Utilities Manager John Arrowsmith as he presented his 10-year financial forecast to the board Thursday evening at the Annex Building. However, he said, it is expensive and might require a new source of revenue to prevent an excessive rate increase.The San Juan-Chama diversion represents one of very few blips Arrowsmith predicted. Other figures for water, wastewater, electricity and gas look relatively stable, with rates going up at regular intervals and the county’s reserve fund balance remaining firm over the course of the next decade.Arrowsmith included water distribution rate increases every three years: 8.62 percent in 2010, 8.25 percent in 2012, 5.71 percent in 2015 and 5.41 percent in 2018. These figures are preliminary; each increase – as with those for all utilities services – requires approvals from both the Utilities Board and Los Alamos County Council, and the public is invited to comment at each hearing.Wastewater figures, according to Arrowsmith’s projections, will rise 7-8 percent in 2010, 2013 and 2016. As the price of gas rises, gas rates should rise at 8-9 percent for each the next three years, and then around a 4 percent every other year after 2011.If the board and council were to approve rates comparable to Arrowsmith’s suggestions, customers could expect to see electric rates rise about 5 percent in 2009 and 2011. The forecast shows a 10-percent decrease in the rate in 2015, when Arrowsmith expects the cost of power to decrease. Thanks to phases three and four of the Diamond Drive Project, as well as work on N.M. 502, the utilities department expects bond proceeds for electricity distribution of $2 million in 2010, giving it a substantial boon in net cash flow that year. Nevertheless, Utilities Manager Buck Monday expressed disappointment with the current sourcing of electric power.“We’re short of power,” he said. “We are buying 25 percent of our power (from outside sources). I don’t like it.”He added that although the county has many “green” projects in the works, “I don’t think we can get enough solar power to make up that 25 percent … unless the lab is successful in learning to store power.”In discussing his predictions, Arrowsmith said he plans to revise the electricity figures because he thinks the timeline for the county’s green purchases is too optimistic. Conservation measures the county hopes to have in place by 2010 will probably take a few extra years to install and demonstrate an effect, he said.In discussing a possibly related item, the board considered the advantages of building a solar array at the lab’s Area G. Because the location sits on top of a mesa, there would be no interfering shadows, board members agreed. However, contamination, the length of time it might take to set the project in motion and a negative visual impact for the neighboring Pueblo of San Ildefonso made the project less appealing.County council is scheduled to discuss utilities April 30.Visit the utilities department online at www.lac-nm.us/ – choose “Boards and Commissions” and click on  “Board of Public Utilities.”