HomeMy Public PortalAbout069-2004 - Amends RP&L RatesORDINANCE NO. 69-2004
AN ORDINANCE ADOPTING A NEW SCHEDULE OF
RATES AND CHARGES FOR SERVICES RENDERED
BY THE CITY OF RICHMOND’S MUNICIPAL ELECTRIC UTILITY,
RICHMOND POWER & LIGHT
WHEREAS, the City of Richmond, Indiana owns and operates a municipal electric utility known as Richmond Power & Light (the “Utility”) for the purpose of generating, acquiring and distributing
electric energy in said City and surrounding areas; and
WHEREAS, the existing rates and charges for electric services provided by the Utility were placed into effect following approval by the Indiana Utility Regulatory Commission (the “Commission”)
in Cause No. 40434, Order dated March 19, 1997 and the level of operating revenues was last revised in Cause No. 39465, Order dated December 30, 1992; and
WHEREAS, the Utility intends to file with the Commission a verified petition seeking approval of a new schedule of electric rates and charges that would reflect reasonable and just
rates and charges under IC 8-1.5-3-8; and
WHEREAS, the Utility engaged The Prime Group, LLC, CPAs and Consultants, to perform a financial study of the Utility’s revenue requirements under IC 8-1.5-3-8 for the test year ending
March 31, 2004, as well as a cost-of-service study, based upon the Utility’s pro forma revenues, expenses and net original cost of plant in service during the test year; and
WHEREAS, a study of the Utility’s revenue requirements has been performed and the Common Council has been advised by the Board of Directors of Richmond Power & Light that the Utility’s
annual pro forma operating revenues do not produce sufficient revenue to meet the Utility’s statutory revenue requirements, and revenues from rates and charges need to be increased
by approximately 8.7% to provide for the revenue requirements set forth in IC 8-1.5-3-8, including a reasonable return on net plant in service; and
WHEREAS, the Common Council has been further advised that the Utility’s rates and charges should be redesigned to more accurately reflect cost-of-service and reduce subsidy excess revenues
between customer classes; and
WHEREAS, the Board of Directors of the Utility has adopted Resolution No. 3-2004 recommending to the Common Council that it approve by Ordinance an increase in operating revenues produced
by the revised schedule of rates and charges for electric service prepared by The Prime Group, LLC; and
WHEREAS, based upon the foregoing, the Common Council of the City of Richmond now finds that (i) the Utility’s annual operating revenue from rates and charges should be increased by
approximately 7.86%; (ii) the Utility’s rates and charges should be adjusted to more accurately reflect cost-of-service and reduce the level of subsidy/excess revenues between customer
classes; (iii) the attached proposed rates and charges reflect therein the election of the Common Council to include in such rates and charges each of the elements of “reasonable and
just charges” under IC 8-1.5-3-8, including a reasonable return on net utility plant which, together with the Utility’s other revenue requirements, will produce a rate of return of
approximately 5.20% on the Utility’s net utility plant; and (iv) the proposed rates and charges attached hereto as Exhibit “A” are “nondiscriminatory, reasonable, and just” charges
for services within the meaning of IC 8-1.5-3-8.
NOW, THEREFORE, BE IT ORDAINED BY THE COMMON COUNCIL OF THE CITY OF RICHMOND, INDIANA, THAT:
Section 1. The schedule of revised rates and charges attached hereto as Exhibit “A” is hereby adopted as and for the rates and charges to be utilized by the Utility when charging customers
for electric service, effective as set forth below.
Section 2. All Ordinances and parts of Ordinances in conflict herewith are hereby repealed, provided, however, that the existing schedule of electric rates and charges shall remain
in full force and effect until the schedule of rates and charges fixed by this Ordinance shall be approved by the Commission, and until such time as the Order of said Commission approving
said new rates and charges shall direct.
Section 3. This Ordinance shall be in full force and effect from and after its passage; provided, however, that the schedule of rates and charges herein adopted shall not become effective
unless and until approved by the Commission or until such time as said Commission shall direct.
Section 4. The necessary and appropriate officials of the Utility are hereby authorized and directed to file with the Commission, a verified petition seeking approval of a new schedule
of electric rates and charges, as well as testimony and exhibits in support thereof, in accordance with the above findings.
ADOPTED AND ENACTED BY THE COMMON COUNCIL OF THE CITY OF RICHMOND, INDIANA THIS _20th_ DAY OF _September_, 2004.
S/S Larry Parker___________________
President, Common Council
City of Richmond, Indiana
ATTEST:
S/S Karen Chasteen______________
Clerk
City of Richmond, Indiana
Presented by me to the Mayor of the
City of Richmond, Indiana this
_21st__ day of _September___, 2004
S/S Karen Chasteen_______________
Clerk
City of Richmond, Indiana
THIS ORDINANCE APPROVED and signed by me this _21st_ day of September_, 2004.
S/S Sarah L. Hutton_____________
Mayor
City of Richmond, Indiana
ATTEST:
S/S Karen Chasteen___________
Clerk
City of Richmond, Indiana