CITY COUNCIL AGENDA ITEM
ACTION REQUESTED:
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Conduct the first reading of an ordinance amending Title 8 (Public Utilities) Chapter 1 (Electricity) Article C (Electric Service Rates) of the Naperville Municipal Code
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DEPARTMENT: Electric Utility
SUBMITTED BY: Brian Groth, Electric Utility Director
BOARD AND COMMISSION REVIEW:
The Public Utilities Advisory Board (PUAB) reviewed the proposed Electric Utility (Utility) service levels and capital plan at its May 9, 2024, meeting and unanimously approved staff's recommendations.
The Financial Advisory Board (FAB) reviewed funding recommendations aligned with the PUAB-approved service levels on Sept. 4 and Oct. 28. At the Oct. 28 meeting, the FAB approved a recommendation to adjust electric rates as presented here.
BACKGROUND:
The Utility provides high-quality, reliable electrical service to more than 62,000 residential and commercial customers. Detailed financial planning, including annual budget development and periodic rate studies, is essential to provide continuity of services and sustainable capital investment.
The Utility's last rate study was conducted in 2021 to address its operational and capital financial needs through 2024 and ensure that each rate class is paying its fair share of overall system costs. In 2021, the City Council approved rate increases that went into effect in January 2022. Additionally, slight adjustments were made to the fixed charge on each customer's bill; these fixed charges ensure that the utility has a consistent source of revenue to maintain the utility's operations and infrastructure regardless of fluctuations in the amount of electricity used by customers.
With the Utility now in the final year of the 2021 rate study, staff contracted with Utility Financial Solutions (UFS) to perform a rate study providing an appropriate financial plan for the Utility through 2027.
DISCUSSION:
Study Goals
The primary goals of the 2024 rate study were to stabilize cash reserves i...
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