Skip to main content

Electric rates due to spike

Lead Summary

by Tom Coombe
Customers of the Ely Utilities Commission could soon be in for a case of sticker shock.
Later this spring, utility rate payers in the city may be paying seven percent more for electric service, as part of an increase proposed by the EUC in the wake of wholesale rate hikes implemented by the city’s electric provider- Minnesota Power.
City council members took the first step towards authorizing the consumer rate hike, scheduling a public hearing for March 15 at 5 p.m., prior to the next regular meeting.
Approval by the council is needed before the increase will take place, but members generally approve increases forwarded by the EUC and there were no sign of resistance on Tuesday.
“Seven percent is what we’re getting from Minnesota Power and we can’t absorb it,” said mayor Chuck Novak.
The impact on Ely residents and business owners will depend on their consumption of electricity and current bills.
Typically, the EUC presents a series of scenarios once rate hikes come before the council at a public hearing.
A year ago, the EUC raised electric rates in town by one percent after a 1.06 percent wholesale increase from Minnesota Power.
The proposal this year is much more dramatic and could be a sign of things to come, according to council member Al Forsman.
“I can’t let this rate increase with the utilities go unmentioned here,” said Forsman. “I do want everyone to know that Minnesota Power has raised their rates to us by seven percent and our rates committee looked hard at these numbers.”
Forsman added that the EUC tried “to figure out how we could absorb some of that and when you start looking at our costs it’s not something that can be done.”
According to Forsman, national politics and energy policy are likely to lead to even more cost to the consumer.
“On a personal note, I feel strongly we’re going to see energy rates increase dramatically over the next few years, in large part due to the focus of our current administration. I think we can count on seeing this and don’t be surprised if it continues to happen. Your votes count.”
Over the last decade, the EUC has implemented a series of slight rate hikes, all aimed at maintaining fund balances, supporting capital projects and staving off a need for major rate hikes in single year.
Three overall adjustments for 2020 were approved.
The fixed water rate climbed from $15.25 per month to $15.75 and sewer went $15.20 to $16.20, resulting in a flat monthly rate hike of $1.50 for all customers.
Most customers paid one to one-and-a-half percent more on their monthly bills, according to calculations made by the EUC, because of the 2020 rate adjustments.

Sign up for News Alerts

Subscribe to news updates