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i <br /> Elk River <br /> Municipal Utilities <br /> 322 King Avenue phone: 763.441.2020 <br /> Elk River.MN 55330 Fax:763.441.8099 <br /> October 1, 2003 <br /> To: Elk River Municipal Utilities Commission <br /> John Dietz <br /> Jerry Takle <br /> James Tralle <br /> From: Bryan C. Adams <br /> Subject: Electric & Water Rate Comparisons <br /> The attached two spread sheets reflect water and electric rate comparisons with adjoining <br /> communities. <br /> The water rate comparison to other communities was completed last year(2002), and was <br /> not redone this year. There is a large difference in rate structure and unit costs. Elk <br /> River Municipal Utilities rates are well within the range of rates from the other <br /> communities. Considering customers pay $1.00 for a quart of bottled water at a store, <br /> which translates into $4,000/1,000 gallons, there is not a lot of downward pressure on <br /> water rates. Currently, an average residential water customer pays approximately $11 to <br /> $12/month for a municipal water bill in the winter months. In an effort to curb lawn <br /> sprinkling, the attached marked-up tariff sheet reflects staffs thoughts on water rate <br /> increases. Do we want to continue the $1.00 discount for senior citizens? <br /> The electric rate comparisons was just updated to reflect current retail rates and PCA's. <br /> This study again reflects what was true in the past. The Elk River Municipal Utilities <br /> residential and commercial rates are competitive and possibly to low for the <br /> non-summer months. Elk River Municipal Utilities continues to be very non-competitive <br /> for our demand customers. We are also hearing more comments from our demand <br /> customers about our non-competitive demand rates. <br /> Great River Energy has given us the preliminary 2004 rates which reflects an <br /> approximate $639,000, increase from the rate change. See section 5.4 of this agenda. <br /> Also, the required CIP spending will increase by $39,620. To compensate for these <br /> expense increases of approximately $679,000, retail rates must increase by 3.99 mils. <br /> The mark-up tariff sheets reflect staffs thoughts on the electric rate increase. The off <br /> peak rate changes are still unknown at this time. <br />