North Dakota rate case
Public Service Commission approval required
Otter Tail Power Company is a regulated utility, which means the Minnesota and South Dakota Public Utilities Commissions and the North Dakota Public Service Commission approve the amount we charge customers for producing and delivering their electricity.
Update
To address rising costs and growing energy use, Otter Tail Power Company is proposing to increase our base rates for electric service in North Dakota for the first time since 1982.
The overall revenue increase requested is approximately $6.08 million or 5.14 percent, over 2007. This doesn't mean that all customers will see a 5.14 percent increase. Some customers will see less and some will see more based on their electric service rate and the amount of electricity they use.
Interim rate increase
The North Dakota Public Service Commission approved our request to increase rates on an interim, or temporary, basis beginning January 2, 2009. This request was part of our original filing. As part of the interim rate process, base rates will be adjusted to reflect 2007 fuel and purchased-energy costs that historically were passed through to customers in the cost-of-energy adjustment. The requested interim rate increase of $4.8 million, or 4.07 percent, will be applied to that new base rate. The interim rate increase, if approved by the PSC, will remain in effect for all North Dakota customers until the PSC makes a final determination on the company's filing, which is expected to occur by July 2009. If final rates are lower than interim rates, we will refund customers the difference with interest. If final rates are higher than interim rates, the higher rates will become effective as of the date in the PSC Order approving those rates.
Sample rate case impacts
If the North Dakota Public Service Commission (PSC) approves our request for final rates as filed, a residential customer using an average of 836 kilowatt-hours of electricity a month—the average monthly kwh use for the residential class—would see an increase of $5.01 a month over 2007. Similarly, subject to PSC approval, a commercial customer using an average of 2,946 kwh of electricity a month—the average monthly kwh use for the commercial class—would see an increase of $2.26 a month over 2007. These examples do not include future increases or decreases to the cost-of-energy or other adjustments.
Change that may be of interest
We proposed several rate changes as part of our filing. One rate change that customers may want to note is the elimination of declining block rates, which are rates that allow customers to pay less per kilowatt-hour as they use more electricity. Because higher-use customers will see a greater increase on their bills than lower-use customers, the elimination of declining block rates encourages customers to save money through energy conservation.
Information resources
Even after this case, Otter Tail Power Company's rates will be among the lowest in the nation. And we have a number of resources available to help customers manage electricity costs. Visit www.ConservingElectricity.com or call Customer Service at 800-257-4044 to access those resources.
The PSC will hold public input sessions related to the filing and will post the hearing schedule on its web site once the schedule is determined.
Tentative schedule
Interim rates |
January 2009 |
Public input sessions |
Early 2009 |
Technical hearings |
Spring 2009 |
Final decision |
Mid-summer 2009 |
