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SD PUC grants increase in Otter Tail Power Company rates
Fergus Falls, Minnesota - June 23, 2009 Today the South Dakota Public Utilities Commission (PUC) granted Otter Tail Power Company a revenue increase of $2.9 million, or about 11.7 percent. This increase is over what customers paid in 2007 including the energy adjustment, which will continue to fluctuate with changes in the costs associated with purchased power and the fuel the company uses to serve its customers.“This is our first rate case in South Dakota since 1987,” said Chuck MacFarlane, Otter Tail Power Company president. “One of the primary drivers of this level of increase, along with rising costs and growing energy use, is the cost associated with the significant amount of wind energy we’ve added. And while the revenue increase is less than the total amount we requested, the commissioners agreed with our proposals on many of the issues in the case.”Some customers will see less than the overall revenue increase of 11.7 percent and some will see more, based on their electric service rates and the amount of electricity they use. That means, for example, during the summer season a residential customer using an average of 894 kilowatt-hours of electricity a month—the average monthly kwh use for the residential class—will see an increase of $6.72 a month. A small commercial customer using an average of 3,073 kwh of electricity a month—the average monthly kwh use for the commercial class—and a demand of 8.0 kw will see an increase of $31.88 a month. These examples do not include future increases or decreases to the energy adjustment.Customers also will see several rate changes as a result of the PUC decision. One change is the reduction 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, reducing the number of declining block rates and the price differentials associated with them encourages customers to save money through energy conservation.Otter Tail Power Company increased rates, as allowed by South Dakota statutes, on a temporary basis beginning with electricity used on and after May 1, 2009. The company will implement final rates in July 2009. Along with their first electric service statement reflecting the approved rates, customers will receive a notice explaining how the overall revenue increase impacts various rates on which the company serves its customers.Otter Tail Power Company, a division of Otter Tail Corporation (NASDAQ Global Select Market: OTTR), is headquartered in Fergus Falls, Minnesota. It provides electricity and energy services to more than a quarter million people in Minnesota, North Dakota, and South Dakota. To learn more about Otter Tail Power Company visit www.otpco.com. To learn more about Otter Tail Corporation visit www.ottertail.com.-30-
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Media contact
- Cris Kling
- Director, Public Relations
- During business hours: 218-739-8297
- After business hours: 218-842-5579
- ckling@otpco.com
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