BED to Seek Rate Increase

first_imgBED to Seek Rate IncreaseBurlington Electric Department announced October 23, 2008, that it will seek a rate increase of up to 5.9 percent from the Public Service Board, pending the approval of the City Council. The increase would become effective Jan. 1, 2009. The exact amount of the increase will be determined as BED endeavors to arrange the optimal debt strategy for 2009 and beyond. The need for the increase is driven by increased power, transmission and operating costs, along with declining sales of electricity that are a result of BED’s successful energy efficiency programs.BED has advanced its ongoing major capital projects, the McNeil air quality improvements and the East Avenue reliability upgrade, through favorable short-term borrowing arranged through the City. This allows BED to reap the benefits of these projects in lowered operating costs as it moves into 2009 without fully absorbing the cost of the debt these projects will require.”That’s the bright side,” said general manager Barbara Grimes. “More problematic is that these projects will still need long-term financing in a bond market that is very uncertain, given the current financial turmoil. Though thankfully we have voter support to obtain bond funding, and we prefer long-term to short-term debt, the bond market is currently expensive. It is difficult to say today when the time will be right. But by implementing these cost-effective projects now, we can count on reaping their benefits to lower the amount needed when we do go for long-term financing.”BED is sensitive to the difficult economic times Burlington’s residents and businesses are experiencing. “While we’re reluctant to put off what we know will be needed and defer debt until tomorrow, we think it is best in the current economic situation to ask for as small a revenue increase as possible,” said Grimes.BED will continue to offer aggressive energy efficiency programs to all its customers. “We’ve known through our planning that these programs will reduce revenue and impact rates in the short term, but participating in these offerings is the best way for our customers to lower their own bills and offset the increased cost. The payoff will come in the long term, when BED can avoid buying new supply sources.”All BED customers are encouraged to explore what’s available for reducing their energy bills by visiting BED’s web site, www.burlingtonelectric.com(link is external), or by calling 658-0300.#30last_img read more