|
JEA Board Approves Increased Fuel Rate, Undergrounding Pilot Program
Jacksonville, FL (February 15, 2005) - After a public hearing today, the JEA Board of Directors voted to increase the average residential electric bill by 10 percent to offset rising fuel costs, and approved a pilot program to help neighborhoods place electric distribution lines underground.
Beginning April 1, JEA will increase its price per 1,000 kilowatt hours (kwh) on the fuel portion of the electric bill by about $8. Based on the average use of 1,200 kwh, the average residential electric bill will go up about $10 a month.
The increase will also allow JEA to create a fuel stabilization fund to offset fluctuating fuel costs throughout the year, and pay back revenues into a fuel reserve fund that has been depleted over the last five years as JEA held back on raising electric rates.
"Barring a major change in the fuel market and the world economy, this rate increase should protect JEA and its customers from another electric rate increase for two years or more," said JEA CEO Jim Dickenson. "Even with today's vote, JEA will continue to have the lowest residential electric rates, and among the lowest commercial electric rates, in the state."
Prior to last November, when JEA approved a 5.5 percent fuel adjustment rate increase, the utility had not raised rates for 14 years.
In addition, the JEA Board of Directors also approved a pilot program that will allow neighborhoods to pay to have existing electric lines placed underground. When more than 90 percent of neighborhood residents request it, they can pay an additional $22 per month for 30 years to fund burying the electric lines within the right of way along their streets. The staff proposes a maximum annual budget of $4 million for the voluntary pilot program, which would fund undergrounding projects for about 1,000 customers a year.
Through coordination with JEA, residents will then pay out-of-pocket to fund burying the lines from the right of way to their homes.
So far, four Jacksonville neighborhoods have approached JEA requesting the program in their neighborhoods. The program does not apply to transmission lines.
JEA is the eighth largest community-owned electric utility in America, providing electric, water and sewer services to more than 750,000 accounts in Northeast Florida.
JEA Electric Rate Change for April 1, 2005
Background
JEA's fuel rate will increase from $22.50 per 1,000 kilowatt hours (kwh) to $30.32 per 1,000 kwh effective April 1, 2005 representing about an $8 increase per 1,000 kwh. Based on the average use of 1,200 kwh a month, the average residential bill will go up about $10 a month.
Specific elements of the proposed fuel rate include:
- An increase in the fuel charge by $3.95 per 1,000 kwh to a total of $26.45. This portion of the rate will also become variable, meaning that it will go up or down based on actual fuel costs. It will normally only be adjusted once a year.
- Adding another 97 cents per 1,000 kwh to create a fuel stabilization fund. This fund will allow JEA to absorb fluctuations of fuel costs that are less than 10% throughout the year without increasing the rate. This charge is designed to terminate once it builds a fund that is 15% of JEA's annual fuel expense, which is estimated to occur in five years.
- A fuel recovery component of $2.90 charge per 1,000 kwh that will be used to pay revenues back that were borrowed from other electric system sources to pay fuel expenses since 2000. This portion will only be collected until the borrowed funds are returned or in seven years - whichever occurs first.
- With the increase, JEA maintains the lowest residential electric rates in the state and among the lowest in the southeast.
- For commercial customers, rates will rise between 14 to 20 percent dependent on use.
- On November 1, 2004, JEA implemented an increase in the fuel rate charge of $4 per 1,000 kilowatt hours for residential and commercial customers - its first increase of residential electric rates for 14 years.
- JEA uses coal, petroleum coke (petcoke), natural gas, oil, and solar power. This diversity has allowed it to maintain the lowest rates for Jacksonville customers.
Overhead to Underground Residential Pilot Program
- When more than 90 percent of a neighborhood requests it, residents will pay an additional $22 per month for 30 years to fund burying the electric lines within the right of way along their neighborhood streets. JEA will set a $4 million annual budget for the voluntary pilot program, which can fund projects for about 1,000 customers a year.
- This program only involves the cost of moving electric distribution lines underground that are in the street right of way. Through coordination with JEA, residents would then pay out-of-pocket to fund burying the lines from the right of way to their homes.
- There would also be out-of-pocket costs paid to Bell South and Comcast Cable (where applicable) if residents choose to bury these lines as well.
- So far, four Jacksonville neighborhoods have approached JEA requesting undergrounding distribution lines in their neighborhoods.
Customers should contact 665-6000 for more information, or visit jea.com.
|
