Why Do Rates Increase?

Why does your local public utility organization raise your utility rates? The most common reason given (and reasons must be given) is the fact that they often need to make repairs, updates, etc. to existing equipment and that cost trickles down to the consumer. Sometimes the rates are increased in order to keep up with cost of living, as well as changes in weather and the environment. 


Our goal is to make our rates simple, understandable, and acceptable for our Coldwater community members. Ultimately the City and the Board of Public Utilities want to clear any misconceptions that my arise from a rate change.


ELECTRIC:


The electrical rate adjustment that was recently approved is the direct result of the 2015 cost of service (COS) study for the electric utility. The proposed rate adjustments keep the financial performance of the fund on target to meet near term capital needs (infrastructure) and power supply cost (cost to obtain electrical power) increases. 

WATER & WASTEWATER:


These adjustments are the result of the update by Utility Financial Solutions (UFS) of the cost of service (COS) studies for the water and wastewater operations. The proposed rate track supports the 5 year financial projections and capital needs (infrastructure) for both utilities. 

Water & Wastewater Charts

wwtp_rainbow

Additional reasons your public utility may raise rates:


  • Operations - Putting money towards operations allows the public utility to hire more employees for different departments as the surrounding areas grow.
  • Maintenance - Maintenance allows the public utility to fix, upgrade, and maintain already installed equipment.
  • Replace old infrastructure - Money set aside for replacing old parts is crucial for any public utility. Eventually pieces need to be replaced in order to work efficiently. A rate increase will help with getting the best equipment for your use. 
  • Meet state requirements - In order for the CBPU to keep supplying water to residents, we must meet state requirements. These requirements are directly related to any water that you drink, flush, bathe, or swim in.
  • Upgrades to pumping stations - These stations are located in different places around the community. Pumping stations are responsible for lifting water up high enough in order to pump it elsewhere. They are used for a variety of reasons such as the supply of water to canals, the drainage of low-lying land, and the removal of sewage waste to processing plants.