HomeMy Public PortalAbout011-2020 - Rate Study and charges1
CITY OF RICHMOND, INDIANA
ORDINANCE 11-2020
ORDINANCE ADOPTING A NEW SCHEDULE OF RATES AND CHARGES
FOR SERVICES RENDERED BY RICHMOND POWER & LIGHT COMPANY
WHEREAS, the City of Richmond, Indiana owns and operates its own electric
Utility, Richmond Power & Light Company (hereinafter "RP&L" or the "Utility"), under
the supervision and control of the Board of Directors (hereinafter "Board"), of RP&L
pursuant to IC 8-1.5-3-4; 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. 42713 in a Final Order dated February 9,
2005; and
WHEREAS, the Utility has engaged the services of NewGen Strategies &
Solutions, LLC, to perform a financial study of the revenue requirements of the Utility
for the test year ending September 30, 2019, as well as a cost -of -service study, based,
upon the Utility's pro forma revenues, expenses and net original cost plant in service for
such 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 9.58% to provide for the
revenue requirements set forth in IC 8-1.5-3-8, including a reasonable return on Rate
Base; and
WHEREAS, the Board adopted Resolution No. 0-2020 on ,
2020, which (i) recommended approval a new schedule of rates and charges for electric
service provided by RP&L based upon a study of the Utility's revenue requirements
under IC 8-1.5-3-8 and the results of a cost of service study and (ii) pursuant to IC 8-1.5-
3-4(a)(7) recommended said rates and charges to the Common Council for its review and
approval; 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, based upon the recommendation of the Board, the Council desires to
create adopt a new schedule of rates and charges for RP&L;
NOW THEREFORE, BE IT ORDAINED BY THE COMMON COUNCIL OF
THE CITY OF RICHMOND, INDIANA, THAT:
SECTION 1. The findings and determinations set forth in the preambles to this
Ordinance are hereby made findings and determinations of the Council.
SECTION 2. Based on 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 9.58%; (ii) the Utility's rates and charges
should be adjusted to more accurately reflect cost -of -service; (iii) the proposed rates
attached hereto as !bit . 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
6.59% on the Utility's Rate Base, and (iv) the proposed rates and charges attached hereto
are "nondiscriminatory, reasonable and just" charges for services within the meaning of
IC 8-1.5-3-8.
SECTION 3. The necessary and appropriate officials of the Utility, its attorneys
and consultant are hereby authorized an 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.
SECTION 4. All resolutions or ordinances or parts thereof in conflict with the
terms and conditions of this Ordinance are hereby repealed and replaced to the extent of
the conflict.
SECTION 5. This Ordinance shall be in full force and effect from and after its
adoption by the Common Council, approval by the Mayor, and publication as required by
law, provided however, that the schedule of rates and charges herein adopted shall not
become effective unless and until approved by the Indiana Utility Regulatory
Commission or until such time as the Commission shall direct.
Passed and adopted by. the Common Council of the City of Richmond, Indiana
this�� dayo 20.
RICHMOND COMMON COUNCIL
Vice President
'LarkParker
0
Chasteen, IAMC, MMC
PRESENTED to the Mayor of the City of Richmond, Indiana, thi�/day of
2020, at// .m./ M.
Karen Chasteen, IAMC, MMC
APPROVED by me, David M. Snow, Mayor of the City of Richmond, Indiana,
this %l day of l 2u 2020, at I IZ a.m
ATTES
Karen Chasteen, IAMC, MMC
EXHIBIT A
New Richmond Power & Light Tariff