Heavy winter snowpack prompts releases from Salt River Project Reservoirs || Arizona Dept. of Water Resources
By Ryan Randazzo || The Arizona Republic
Salt River Project officials decided Tuesday that a $5.60-a-month rate hike kicking in this November will not cover the utility’s growing power and fuel expenses and voted to double it.
SRP had already raised prices by $5.60 for an average customer last fall.
But SRP has had to sign additional contracts for natural gas, solar and battery power to shore up supplies in 2024 after state regulators at the Corporation Commission rejected the company’s plans to expand a gas plant in Coolidge, and those new contracts are causing about two-thirds of the additional increase approved Tuesday, officials said.
With the upcoming increase of about $12 ― combined with last year’s increase of about $6 ― customers will pay about $18 more per month starting this November than they did in October 2022.
The actual impact of the rate hike depends on how much electricity customers use in a month.
SRP calculates a “fuel and purchased power adjustment mechanism” on each kilowatt-hour of electricity customers use, and the technical change officials approved Tuesday is an increase to that fee. What will happen in November is the “FPPAM” will increase by 1 cent per kilowatt-hour customers use.
Residential customers use an average of about 1,200 kilowatt-hours monthly year-round, but that rises to about 2,000 kilowatt-hours per month in the hottest months of July and August, meaning those bills will jump about $20 a month in 2024, not including the increase that took effect last year.
Board member Stephen Williams asked SRP managers why they had to raise rates the additional $6 a month, which is about 4.9%.
“Why don’t you go a little less? Think about the customers,” Williams said.