Loading...
HomeMy WebLinkAbout1975 GO I i F 6 yREPORT ON ELECTRIC RAMS DENTON MUNICIPAL UTILITIES DENTON, TEXAS i BLACK & VEATCH/consulting onalneArs Q7es 1 1 J l I~ r R ,A r r 11r r BLACK & V EATCH TWL.18161361.7000 CONSULTING ENGINEERS TELEX 42.6263 1600 MRADOW LAKL PARKWAY MARINO A00019 85i I,OX01 NO. 404 KAN4Af V7Y, MIt40UR1 64114 4 June 10, 1975 Mr. Douglas P. Blackburn Director of Utilities City of Denton Denton, Texas 76201 Dear Mr. Blackburns We are submitting herewith a report covering our study of rates of the Denton electric system. The scope of our work has included projections of energy sales and revenues under present rates and revenue requirements of the electric system for a period beginning fiscal year 1975 through fiscal year 1960. A determination has been made on the basis of this analysis of the needed overall level of rate adjustment by the utility. A complete set of electric rate schedules has been designed that will provide a 13.1 per cent overall increase in revenues from basic rates and are included herein for the Cityt+s consideration. Tables have been prepared to shoo comparisons of Denton's present and proposed electric rates with the rates of other utility systems to the general region. We appreciate the opportunity to be of service in this matter and will be available to present the report at your convenience. Very truly yours, BLACK & VEATCH P, K. Co.^krell gt 4414 ,fv,-, ez.~,.f'f+.d~*~',yff''k TABLE 01 CONTENTS Mot INTRODUCTION 1 FINDINGS AND RECOMMENDATIONS 1 PRO FORMA STATEMENT OF INCOME 5 A. GENERAL 5 B, OPERATING REVENUES 5 1. Retail Sales 5 2. Sales for Resale 9 3. Other Operating Income 9 C, OPERATING EXPENSES 10 1. Fuel Expense 10 2. Other Production Expenses 10 3. Transmission and Distribution Expense 10 4. Administrative and General Expense 10 5, Reclassified to Capital Accounts 10 6. Depreciation 11 D, OPERATING INCOME it E. OTHER INCOME 11 F, BOND INTEREST 11 G, NET INCOME 12 PRO FORMA CASH FLOW ANALYSIS 13 A. GENERAL 13 B. BOND RESERVE PAYMENT 13 ~9. cy ti wk i N '.Yi "Its rti nr ~I Jx dd1'~i ~e "0 l . YD,~ ~y~ ~ Page l C. RESERVE FOR EXTENSIONS AND IMPROVEMENTS 1S D. TRANSFERS TO CITY GENERAL FUND 1S i E. ADEQUACY OF EXISTIA, RATES 15 ANALYSIS OF RATES 18 A. GENERAL 18 B, DESIGN OF RATES le 1. Rooldential Service 18 2. Commercial Service 19 3. Municipal Service 20 4. Lighting Service 21 S, Summary 21 TYPICAL SILL COMPARISON 23 APPENDICES Appendix A - Proposed Rate Schedules Appendix B - Present Rate Schedules R'-vf ,x°1 ~ iJ ~ ~ ~ ~4 ypr d~•o' ti7 S,~ '}v x. 1R ? ~1;,~ Paste LIST OF TABLES Table 1 - Statement of Actual and Projected Energy Sales and System Losses 6 4 Table 2 - Pro Forma Income Statement, FY 1970-1980 7 Table 3 - Pro Forma Cash Plow Analysis, FY 1970-1980 14 Table 4 - Relation of Surplus or Deficit Revenues to Revenues from Base Rates 17 Table S - Comparison of Revenues Under Vxisting and Proposed Rates, Fiscal Year 1974 22 Table b - Typical Bill Comparison 24 Tablu 7 - Typical Bill Comparison at $0.82 Pet Million BTU Fuel Cost 26 i ~I l 7, fill. i , i 2 A'' INTRODUCTION This report" summarises a study of revenue requirements of the Denton electric system and presents findings and recommendations concerning rate ` adjustments for consideration by the City. The analyses conducteJ are based on results of operations during a teat year ended September 30, 1974, Proposed rate schedules have been developed based on the cost of service requirements during the tent year period and the indicated need for overall rate adjustment to satisfy the financial obligations of the utility in immediate future years. Comparisons have been made of Denton's present and proposed electric rates with the rates of others in the general region and are shown in tabular form in the text of the report,. A copy of both the present and proposed rates schedules have been :J t included for reference purposes in Appendices to the report. FINDINGS AND RECOMMENDATIONS It is found that total revenues of the Denton electric system during fiscal years ended September 300 1973 and 1974 were insufficient to provide for revenue requirements of the utility by amounts of $201,000 and $337,000, respectively. It is estimated that under present rate levels the deb cit will increase in future years from $431,000 in fiscal year 1915 to $1,013,000 in fiscal year 19804 The cumulative deficit for the period beginning fiscal year 1976 through fiscal year 1980 (October, 1975, through September, 1980) is estimated to be 11.2 per cent of total revenues from basic rates. 1 wf( 4, y a : r Bond ordinances require that 12.5 per cent of each dollar of gross revenue be paid into the ut'iltky'e Extension and Improvement fund. As a result, a rate increase of 12.8 per cent is necessary to net an 1162 per cent increase in basic rates, A total increase in basic rates (before fuel adjustment) of about 13.0 per cent is therefore recommended to satisfy the financial obligations of the electric system for the next five years and to provide a small surplus in immediate future years. It is found that "small use" residential customers whose summer usage does not exceed 700 kilowatt-hours are paying costs of service to a reasonable degree. Residential customers that use over 700 kilowatt-hours per month during the summer season have a highly seasonal load, on the average, and fail ttb pay costs of service by 14 to 20 per cent, dependent on level of usage, Separate rate scheeuler are therefore recommended for small use and large use residential customers in order to reflect the difference in load characteristics and coats of serving the two groups, No change is recommended in the rate applicable to small use customers with the excepts^.e of two minor modifications including an increase in the minimum bill and a revision of the fuel adjustment feature of the rate scheduler ',.i overall increase of 14.7 der cent in basic rate charges is recommended for urge use residential customers, A winter season rate is proposed for both small use and large use residential customers. It is also proposed that an incremental rate charge be continued for consumption of over 700 kilowatt-hours during winter months fur homca that use electric heat as the sole source of a nu:urt heating, 2 '9"' 177 It is recommended that Rate Schedules B-1 and B-2, which are applicable to 514811 and large use commercial and industrial customera, be continued in about their present form, It is proposed that the fuel adjustment and minimum charges of the 2•4 rate schedule be revised and that an expanding block feature be added to provide the equivalent of a demand charge for loads of over 20 kW, It is also proposed that where the last block of the present B-1 rate for usage in excess of 109000 kWh is generally not applicable to the loads of 20 kW or lose served under this rate, that it be eliminated. The small use commercial customers served under Rate Schedule B-1 make an eAsquate payment towarde costs of service, and, except for the foregoing, no change in the B-1 rate is recommended. The proposed B-2 rate has been revised in accordance with cost of service considerations to provide an overall increase in the basic rate charges of 4 12,5 per cent. The level of increase is somewhat lower than 12.5 per cent for smaller customers and about 15 per cent for the largest customers served under the rate. The winter rate feature of the proposed B-2 rate schedule applicable to apartments has bean simplified, A fuel cost Adjustment provision, wherein any increase in fuel coats above a base amount to passed cn to consumers, is presently applicable as a feature of the residential and the commercial and industrial rate schedules, Current fuel coats are approximately 140C per kilowatt-hour of generation which amount is over three times greater than the allowance for fuel cost included in the present basic rates. In order to better reflect actual costa of service, it is recommended that the fuel cost of 1.0C per kilowatt-hour be included as an integral part of all rate 3 ''y , 111 1 11, ,r a .u i. .r ♦ 0 „ charges of the utility, It is also recommended that the present fuel adjustment clause be concurrently revised in statement to provide that • the fuel adjustment amount be based on actual cost of generation, rather • than average cost of fuel, and to incorporate the cost of purchased energy each month. The proposed adder to all rates under this procedure is 0.850 per kilowatt-hour and the level of charges under the revised fuel adjustment clause have been reduced a like amount. It is recommended that the fuel adjustment clause be made applicable to the City's municipal rates as a means to recover out-of-pocket energy related costs on a cvrrent basis. It is also recommended that the municipal rates along %tth all present rates for lighting service be increased 0,850 per kilowatt-hour to include the increase in energy related costs since the rates were established. In the future, the rates for righting service should be reviewed by the utility on a regular basis to insure that an adequate allowance is included for costs of fuel and purchased energy. 4 , s t a . 1 V id ply ] ^ .JI. `i. P i' I"r} ~ s k. i 71 , a Y,.. ~i 1 v''r' .l F• i .i a A;fit k..r ` PRO FORMA STATEMENT OF INCOME A. GENERAL A pro form statement of revenues and revenue requirements for the Denton electric utility system for fiscal years ending September 300 1975 through 1960 has been developed based on analysis of historical financial data, average number of customers, and nat system generation and energy sales. In making the projections, historical trends have been adjusted to reflect anticipated future conditions. 8. OPERATING REVENUES 1, Retail Sales. Table 1 presents a summary of total kilowatt-hours bold by customer class and system losses for fiscal years 1970 through 1974 along with projected sales and losses by years through fiscal year (FY) 1980, Actual and projected revenues by customer classes are shown in Table 2 as a part of the pro forma statement of income for fiscal years 1970 to 1980. The projectione of future revenues from sales are based on an analysis of the historical number of customers, average annual kilowatt- hour consumption per customer, and ~init revenue per kilovott-hour, The following tabulation is presented to show the total customers by rate classes served during FY 1974, the test year of this study, along witn kilowatt-hour sales and revenues. S ~ 1'^f ° .r a r 1f u 1 a,: t . 1-11,17 .1A f 7j7V #,n, { 'T4 17 TABLE 1 i DENTON, TEXAS ELECTRIC SYSTEM STATEMENT OF ACiIJAL AND PROJECTED ENERGY SALES AND SYSTEM LOSSES ~1) (2) (3) (4) (5) (6) Commercial Municipal System Sales Fiscal and and Dusk-to-Dawn System Plus Losses Year. Residential Industrial Stregt Lights Lights Losses ,_(I) to 5 - MwId Mwh Mwh Mwh Muh MWh Actual 1970 80,313 1830054 16,814 377 19,734 3000292 1971 85,933 1910351 18,061 414 23,210 3196169 1972 x45,412 1913 1050412 2212380706 18,642 457 16,386 368;804 ,135 209103 520 2x,640 384'0500 1974 106,251 251,315 200374 392 27,887 406,419 Projected 1975 1179146 260,275 21,233 683 27,fbb2 427.00 1976 122,917 274,500 21,8!3 717 29,241'1 445 21 1977 128,878 290,970 229438 894 30,809 413,989 1978 13300311 309,883 23,031 14035 32,604 3019-603 1979 141,468 331,373 23,672 10200 34,614 532,529 1980 1480004 356,443 24,314 19365 36,854 566,980 v Y4fti rF 'rc . M1v .'4 ul v a .'i .i 'tin'• ....',y'L v li r,d ,,.N c, r.. rl..'.♦ .f.;',. •r :h., u. . ♦ i ]C tl.'..4. L. F ".;p til• „~.~•Yv-k\C i w` W7? 'wj , . .1 • TABLE 2 DOWNS TEXAS AT,IFMIC SYSTEM i PRO FORMA INCOME STATEMENT FY 19%0-1980 (1) (2) (3) (4) (5) (6) (7) (8) (9)I~ (10) (lI) scal Year Ending September 30 _ Actual Projected Uain Preset Rates 1970 1971 1972 1973 1974 1975 1976 1977 197 1979 1980 1,000 1,000 $1,000 1,000 10000 1,000 $10000 1,000 1,0 0 $1,000 $1,000 Operating Revenues Retail Sales Residential 1,734 10855 2,172 2,145 21337 2,413 29520 21629 2,741 2,858 29975 Commercial 21483 2,596 2;946 3,247 3,350 30540 39733 1,937 492X4 40509 40848 Municipal(a) 199 214 196 215 220 226 232 238 2~5 252 258 Dusk-to-Dawn Lights 16 18 19 22 25 29 33 38 4 51 58 Fuel Adjustment - - - 479 786 1#963 2,842 3,821 4,916 6.150 741 Total 4,432 40683 5,333 6,108 6,718 8,171 9,360 10,683 129140 13,820 15,680 Sales for Resale 8 23 40 '88 367(d) (e) (e) (e) (e) (e) (e) Other Operating Revenues 70 88 92 84 134 95 95 95 95 95 Total Operating Revenue 49510 41794 59465 69280 70219 8,266 99455 100778 12,25 13,915 15,775 Operatin4 "'gxpensae Fuel 887 951 18155 1482 2,340 3,289 40259 5,337 6j51 7,892 99412 Other Production 397 466 464 564 647 725 812 909 19018 1,141 1,277 Transmission b Distribution 409 531 521 384 428 454 481 510 5.0 573 607 Administrative 6 General 540 431 A4 575 532 600 630 662 615 730 767 Reclassified to Capital Accts.(b) (131) (126) (189) i - - - - Dtpreciation 739 777 810 ss2 973 1j042 1.069 1,095 1j,1 3 11151 1,179 Total Operating Expenses 2,841 39030 3,305 40258 4,920 6,110 7025;, 89513 9,9 .7 11,487 13,242 Operating income 1,669 1,764 2,160 2,022 2,299 21156 2,204 20265 29318 2,428 29533 Other Income (Interest) 81 241 196 1 9 197 226 243 234 2 5 216 208 1,750 20005 2,356 25221 2,496 2,382 2, 4 2,7199 2,5 3 2,644 2,741 Bo,td Interest (c) 446 623 537 X868 8741 1.033 1,001 951, 8 9 847 793 1 Net Income 1$04 10382 19799 1,r351 11619 1,349 10446 10548 1164 1,797 1,948 (a) Includes street lighting and sales to state highway department, (b) Reclassi;ications are principally capitalized wages and salaries. (c) InclUO.ca proposed $2,000,000 issue in FY 1976 at 6 per cent. (d) Includes $185,000 settlement of inadvertent power exchange. (e) Resale revenues and corresponding full expense omitted. E G `zl.r ^i +Af. _ t~~l..:4 .'i Number of Customers, Energy Sales, and Revenues Fiscal Year 1974 Average Energy Number of Energy Sales per Revenues Unit Customers Saltss Customer from Sales Revenues ea Mwb. kWh S ' C/kWh Residential 100850 106,251 9,793 2,5720051 2.42 Commercial 7,829 2519315 137,406 3,900,316 1.55 Municipal(a) 271 15,268 560338 1670810 1,10 Lighting Services Street Lights 3,375(b) 5,106 1,513 52,073 1.02 Dusk to Dawn Lights 546(b~ 592 10084 25,229 4.26 Total 3 W(b 5,698 77,302 Total, Retail 1212 0f ) 378,532 6,717,979 1777 (a) Includes municipal and county agencies and local school districts. (b) Average number of lights. (c) Excludeq lighting units. • Service to residential customers includes sales to approximately 64 per cent of the customers and accounts for 28 per cent of the kilowatt- hours sold du...tng the test year. Analysis of historical data for residential / service generally indicates a stable increase in the number of customers but a reduced rate of increase in average use per customer, The base rate revenue for kilaAtatt-hours sold in fiscal years 1970 through 1974 (revenues excluding amount for fuel adjustment) has served as the basis for projecting revenues from this class, An approximate level of fuel adjustment has been applies to estimated kilowatt-hours sold to develop estimated revenues which would be derived from appli.:ation of the fuel cost adjustment clause in future years, 8 t ~i v ° w T L< t is 5~ t i.f a 9p "~~y A similar analysis was applied to customers served under Denton`s commercial rates. Projections or revenue from sales to governmental agencies and for street lighting and signal systems exclude the application of fue'. cost adjustment charges in accordance with present practice of the utility. Projected revenue for Dusk-to-Dawn lights is based on a projection of the number of lights times the e%erage unit charge per fixture. The total retail sales including fuel adjustment are estimated to increase from $6,718,000 in FY 1974 to $15,680,000 in FY 1980. It should be noted that $7,5410000 of the estimated revenues in FY 1980 are expected to be derived under the automatic rate adjustment clause for increased fuel costs. i 2. Sales for Resale. Sales for 4'.+eale represent the dollar value of net interchange between Denton and the bEcer members of the Texas Municipal Power Pool (TMPP). Revenues from this source were not significant in the past except during FY 1974. Sales to TMPP during the test yeo.r PY 1974 Included 50,089,836 kilowatt-hours generated with fuel purchased by Denton and 56,580,500 kilowatt-hours generated with fuel purchased and supplied to Denton by other members of TtU'P. Due to tiie nature of these off-system sales and the lack of effect on revenue requirements from retail customers, no attempt has been made to project future revenues from this source. 3. Other Operating Income. This 4ategory includes revenues from penalties, reconnection fees, collection of charged-off accounts and other misael'taneous sources. In recent years, this category of revenues hai averaged about $99,600 per year. An amount of $95,000 has been used as an estimate of revenues from this source througho+it the study period. 9 C, OPERATING EXPENSES 1. Fuel Expense. Currently', Denton receives gas supply from the Lone Star Cas Company and from the Pitts gas field which is leased jointly r by the members of TMPP. In addition, Denton used a small amount of diesel fuel during the teat year. Fuel expense, shown in Table 20 has increased from $887,318 in FY 1970 to $2,339,827 in FY 1974. The average cost of fuel per kilowatt-hour of generation has increased from 0.2950 in FY 1970 to 0.5130 in FY 1974. The cost of fuel is expected to continue to rise throughout the study period. 2. Other Production Expenses. This category of expense includes all operation and maintenance expense for power production other than fuel expense. Based on an analysis of recent experience this category is projected to increase at a 12 per cent annual rate, 3, Transmission and Distribution Expense. The primary elements of transmission and distribution expense are salaries and wages and mainte- nance expenses. These expenses have been projected at a b per cent annual growth rate, 4. Administrative Arid General Expense. This category includes the electric utility's pro rata share of utility administration and its share of administrr:tive services provided by the city government. The projected annual rate of increase for this expense is 5 per cent. 5. Reclassified to Capital Accounts. The amounts included in this category represent adjuotments to capitalize portions of certain items, such as salariest which were charged to expense during the year. 10 ' ♦ ~ ~ t i ' c V v~~>~~ £ k r Tom- w . +r' K r ~~~'dl'jrC Sid j IkL fy'~',r •K~n I ~ t A~, A, r w i,~'t 3~ 7i ~i~.~ 'e- 6. Depreciation. Depreciation expense has been developed by a.pplying a cotoptsite depreciation rate to projected average plant in service during ecah year. Investment in plant at the end of each year has been determined by adding estimated normal additions to be financed from the Extension and Improvement Fund, plus expected major additions to be financed with revenue bonds, to the beginning plant balances each year less estimated retirements during the year. D. OPERATING INCOME Operating income, which is the difference oetween operating revenues and operating expenses of the utility, is projected, as shown in Table 2, to be a relatively constant amount in future years. This residual amount is referred to as the "return on investment" for investor ownrd utility systems, %nd is availaile for all other fiscal needs of the utility including debt service on revenus bonds, reserve funds, financing of extensions and betterments, and payment to the City General Fund. E. OTHER INCOME Other income consists primarily of interest earned on invested funds. The amount of interest earned fluctuates annually depending upon the availa- bility and balances of funds and vary'ng interest rates. For this study, other income has been projected based on the historical experience shown by Table 2 with consideration of expected balances of construction funds provided by the sale of revenue bonds. P. BOND INTEREST The total interest expense includes that shown by payment schedules for 11 .6 , existing bonds, plus estimated 6 per cent interest on a $20000,000 issue of revenue bonds assumed to be sold at the beginning of FY 1976 to finance transmission and distribution system improvements in fiscal year 1976. G. NET INCOME Net income from the electric system operation, shown as the resultant amount in Toble 2, was $1,619,000 during FY 1974. It is projected to decrease to $1,349,000 in FY 1975 and then to increase to $1,948,000 by FY 1980. 12 a 777r,~ r ;4 4_ ~'T J *I t.,A1 r tr :,i y4 PRO FORMA CASH FLOW ANALYSIS A. CENERAL , Table 3 presents a summary of the cash requirements of the electric system for the period FY 1970 through 1980. This table reflects the same revenues as Table 2. The totals shown for operation and maintenance expense in Table 3 exclude allowance for depreciation which is a non-cash expense. The amounts shown for debt service in Table 3 include principal payments on revenue bonds as well as the Interest expense previously shown. The funds provided by depreciation expense and net income are available to meet the non-expense cash requirements of the utility which include in addition to bond principal, Bond Reagrve payments, funding of the Reserve for Extension and Improvements, and tfansfers to the City Cenernl Fund. B. BOND RESERVE PAYMENT Existing bond ordinances require that a monthly payment to be made into a Bond Reserve Account so that an aggregare amount equal to the maximum future principal and interest payment is accumulated within a period of 60 months. The total requirement for this fund is estimated to be $1,947,000, the maximum principal and interest on all outstanding bonds including the $2,000,000 to be issued in FY 1976. if the account ie depleted by any amount, additional payments are required until the fund is restored. The monies available in this fund may only be used for meeting debt service requirements when the funds at?ailable in the Interest and R9demption Fund are insufficient to meet the then maturing principal and interest requirements. Annual payments to the Reserve Account, shown in Table 3, are estimated at $60,000 throughout the study period. 13 , .a , , t':( r: ....C! c ':4. 3-a: w kaii'...1 $.n ~'';+''r. ra a?;'. ♦,pa ::j: ,y .y' r. L.n i>4~'~✓.w.. a,~, r n k: ,:.r. .~1; v t..! 'i::^ w..r , TABLE 3 DEl^t i'ON j TLUS ELECTRIC SYSTEK PRO FOW{A CASH FLOW ANALYSIS PY 1970-1980 (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11j Fiscal Year Endin September 30 Actual Pro ected Using Preset Rates 1970 1971 1972 1913 1974 1975 1976 1977 197 1979 1 8fl $1,000 $ I. Revenues 1 ► 000 T1-'000 $1,000 $1 ,Q00 ,000 $1,000 1,000 *11090 1,000 l~ pp Retail Sales 49432 4,683 5,333 60108 6,718 80171 9,360 100683 12,160 13,820 150660 Sales for Resale 8 23 40 88 334 (b) (c) 95 `c95 (c95 (c) (c) Other Operating Revenues 70 88 92 84 (c95 TOther; ,come es (Interest) 81 241 196 199 5 95 197 226 243 234 2 5 216 205 Requirements 4,591 5,035 5,601 6,479 W1 6 8,492 9p698 11,012 12, q0 14,1 1 15,983 Revenue Requirements Operation and Maintenance Expense Excluding Depreciation Debt 21102 2,253 2,445 31446 3,947 5,068 6,182 7,418 8,7414 10,336 12,063 vica(a~ 11057 1,9417 1,465 10644 19932 19881 20071 2,041 2, 9 , 1974 10041 Bond ' ,,~serve Payment 64 46 78 88 200 - 119 b0 60 0 Reserve for Extensions and Improvements 119 596 708 810 927 1.062 1 212 1 377 1 5 0 1 7660 6 M OR Subtotal ' ► 3,j65 To '31 4,746 5., 810 7,006 8,130 9,525 10,89 12, 14 1 16 6 1 0' Payment to City 429 653 680 732 747 793 811 834 8 2 895 934 Total Revenue Requirements 4,394 49635 5,426 6 0 7,753 8,923 10,336 11,730 13,2 5 15,031 -1 9-6 Surplus or (Deficit) 197 70 235 (301) (337) (431) (638) (718) (805) (900) (1,013) i (a) Includes debt service on existing Issues and a proposed $2,000,000 issue in FY 1976, (b) Includes $185,000 settlement of inadvertent power exchanges (c) Resale revenues and corresponding fuel expense omitted. 14 qtr ~~:i v v ~ r C. ASERVE FOR EXTENSIONS AND IMPROVEMENTS Under existing bond ordinances, the utility is required to deposit not less than 12-1/2 per cent of the gross revenues of the utility in a reserve for extensions and improvements. Monies in this fund may be used only for the purpose of making extensions and improvements to the system or to retire revenue bonds prior to their maturity. In addition, the monies may be used to augment the Interest and Redemption Fund and Reserve Account when the amounts in those funds are insufficient to meet principal and interest requirements. D. TRANSFERS TO CITY GENERAL FUND The electric utility makes a payment to the City Cenerai Fund, in accordance with the Clty Charter and terms of the revenue bond ordinances, based on a maximum allowed rate of 6 her cent of the City's equity in the electric system at the end of the previous year. The City's equity is defined as being equal to the sum of the balances in the Bond Reserve Account and the Extension and Improvement Fund plus the unrealized increment in valuation of utility plant in service, contributions in aid of construction, and retained earnings. Transfer to the City has been projected at the present 6 per cent rate during the study period. E. ADEQUACY OF EXISTING RATES Table 3 summarizes the cash requirements of the electric system. As shown in the table, it is projected that the utility will incur deficits in each year of the study period. The deficits are expected to increase in size throughout the period from $431,030 in FY 1975 to $1,013,000 in FY 1980. 15 4lrL d it"at n Table 4 shows the relationahip of system surpluses, or deficits to revenues from basic rates. The cumulative deficit over the study period is estimated to be $4,505,000 and would required 10.5 percent more revenues from the basic rates to break even. An 11.2 per cent rate increase at the beginning FY 1976 would be necessary to offset the estimated deficits to be incurred FY 1976 to FY 1980, and an even larger increase is necessary to offset the cumulative deficits if any part of the FY 1975 deficit is included. Because of the ordinance requirement that 12-1/2 per cent of each dollar of gross revenue be paid into the Extension and Improvement Fund, a rate increase of 12.6 per cent, for example, is necessary to net an 11 per cent increase in base rates (without fuel adjustment clause). Therefore, an overall increase of at least 13 per cent is indicated to provide adequate operating revenues to fulfill the financial obligations of the Denton elegtric system its near future years. 16 .Yiq tk A rry 'P.;. ..t r,J i. Ht r P 4 ,i*'"°~ } k^ •e ti fJ {pft Y /`.4, 4 $K ~1' e. N e' s Pso ~t r'P4 v,.J k~':r + . Sw cP' ~i tY + 1 ~1' nu TABLE 4 DENTON, TEXAS ELECTRIC SYSTEM RELATION OF SURPLUS OR DEFICIT REVENUES TO REVENUES FRAM BASE RATES evenues (3) (4) {5) Surplus or (Deficits Rgvr Pies Fiscal Retail Sales Other Total R(~ver-,e Amount 'kkW4io Year Base Rates Fuel ~ Revenue (1)+(2)+(3) Requirements - 5 (6) -t (1) Actual $11000 10000 $I.000 $10000 $1,000 $1400 x 1970 4,432 - 159 4,591 4,394 197 4.4 1971 4,683 - 352 5,035 4,965 70 1.5 1972 59333 - 328 5,661 5,426 235 4.4 1973 3,629 479 371 6,479 6,680 (201) (3.6) 1974 5,932 786 698 7,416 7,757 (337) (5.7) r Projected 1975 6,208 1,963 321 8,492 8,923 (431) (619) 1976 6,518 29842 338 9,698 10,336 (638) (9.8) 1977 6,862 3,82`. 329 110012 11,730 (718) (1015) 1978 1,244 40916 320 12,480 13,285 (805) {11.1) 1979 7,670 69150 311 14,1.31 152031 (900) (21'.7) 1980 89 139 79541 303 15,933 16,996 (1,013) (12,4) 1975-80 429641 (41505) (10.6) 1976-80 36,433 (40074) (11,2) i I i ANALYSIS OF RATES I A. GENERAL Present and propoo:d rate schedules al commercial and industrial customers, and toduakltotda~ service lights are incluL,td appendix to this report, B. DESIGN OF RATES The proposed rates have been designed considering principally the overall revenue requirements of the utility along with Cost of service by type and character of loads. In addition, recognitiool has been given to the level and Aestgn of Denton'e existing rates and to the rates for comparable service by other electric utility systems. 1, Residential Service, Tha existing rate schedule for Residential Service A-1 has been divided into two schedules, The proposed schedule A-1 to intended for small residential customers whaAe maximum monthly summer us does not exceed 700 kilowatt- e hours and who use little or no summer season air conditioning equipment, The proposed schedule retains the declining block feature) of the existing rate schedule, It provides a separate rate applicable to usage during the billing months of November through April, in addition to an incremental charge for use over 700 kilowatt-hours in the winter months for homes k-hich use electric heat as the sole source of comfort heating;. It was found, in general, that small non-air conditioning customers are meeting their costs ui service. This group represents about 20 per cent of the residential users but only accounts for about 5 per cent of the residential kilowatt-hour sales. Only the so-called "convenience users'' (such as unoccupied 18 residences, etc.) with usage of less than 50 kilowatt-hours per month in this class failed to meet their allocated cost. To adjust for this condition, the minimum bill has been raised. All steps of the rate, incluAing the minimum, reflect the approximate current cost of fuel of 1.0c per kilowatt-hour. Schedule A-2 is intended for the large use residential customers whose requirements during summer months exceed 100 kilowatt-hours. The proposed rate schedule consists of a fixed cost charge plus a flat rate energy charge in the summer billing months and the same fixed cost charge plus a two stej~ energy rate in the winter billing months. An incremental rate is provided' for customers whose e( home is electrically heated. As with Ratc Schedule A-11 all charges have been adjusted to reflect fuel cost of 1,Oo per kilowatt-hour. 2, Commercial Service. Under existing rate,.,service to commercial and industrial customers is provided under tvo rates - Schedule B-1 which is intended for commercial customers whose nonthly demand is less than 20 kilowatts, and schedule B-2 which is intended for larger customers whose monthly demand exceeds 20 kilowatts. Of the approximately 1,800 customer's served under these ser.edules in FY 19740 10375 received service under the B-1 rate and 425 under the B-2 rate. The proposed B-1 rate is an energy rate intended to be applicable to the same types of commercial customers as the existing rate. The basic rate charges have been adjusted to reflect the increased coat of fuel and tht minimum charge has been increased to more closely reflect the costs to serve this class of service. In addition, an expanding block feature applicable to customers with power demand of greater than 20 kilowatts has 19 I 'y has been incorporated into the rate. This feature was designed to recover costs of serving large commercial customers with low load factors and to provide transition with tLe B-2 rate when demand exceeds 20 kilowatts. The propose!.:: B-2 rate is a demand-energy rate with about the same features as the existing rate. The proposed rate is designed to serve loads of 20 kilowatts and larger. The proposed overall increase in rates to customers served under this rate is 12.5 per cent, with the average being somewhat lower for smaller customers and a greater amount (about 15 per cent) for customers whose demand is greater than 300 kilowatts. 3. Municipal Service. Service under this rate is restricted to city, Bounty, and local school districts. It does not apply to state or federal agencies, North Texas State University or Texas womens University all of which are served under either B-1 or the B-2 rates. Under the present agreement with the City, the rate for municipal service is 1.250 per kilowatt-hour for all sales except those to the water utility and the sewage utility. For these latter services, the rate is 1.00 per kilowatt-hour. Because of the rapidly escalating cost of fuel, it is recommended the fuel cost adjustment charge be made applicable to sales under this classification. Based on the fuel cost incorporated into retail rates, the basic rate proposed for municipal service is 2.100 per kilowatt-hour and for sales to the water utility and sewage utility is 1.850 per kilowatt-hour. These rates will be adjusted as necessary based on the fuel cost adjustment rate applicable to retail sales. If the fuel cost adjustment had been applied during the test year, the additional revenue from this class would have been $44,000. 20 4. Lighting Service. Service provided under this classification consists of sales to the city for street lights and signal systems, sales to the State Highway Department for lighting on the interstate highway, and rental of dusk to dawn lights. Under the existing agreement with the City, the electric system receives 1.00 per kilowatt-hour for energy requirements of the street lighting and signal systems. The State Highway Department povs 1.00 per kilowatt-hour plus the costs of maintenance. The rate schedule for -'Us{.-to-Dawn lights is shown in the appendix. At 1.00 per kilowatt-hour, the rate for street lighting and signal systems presently only covers the fuel expense portion of costs and therefore should be adjusted to at least include the increase in energy related costs rsalized since the rate was established, This adjustment amounts to 0,850 per kilowatt-hour. The existing rates for Dusk-to-Dawn lights have been adjusted to reflect the increased cobt of fuel, In addition, it is recommended that no new rentals of 250 watt lamps be accepted after the effective date of the proposed rate schedules. 5. Summary. A sv=ary of revenues under existing and proposed rates is shown in Table S, It is calculated the proposed rates will produce an overall increase in revenues from sales of 13.1 per cent roldted to basic rate charges and 12.2 per cent when compared with total rata charges, including the amount for fuel adjustment, during PY 1974, 21 i TABLE 5 DENTON, 'T'EXAS ELECTRIC SYSTEM COMPARISON OF REVENUES UNDER EXISTING AND PROPOSED RATES Fiscal Year 1974 Without Fuel Adjustment With Fuel Ad ustment(a) Zxisting Proposed Per Cent Existing Proposed Per Cent Rates Rates Increase Rates Rates Increase Rejidential (A-1) 2,337,377 2,6810000 14.7 2,5729051 2,9169000 13.4 N N Commercial Small Users (B-1) 684,810 731,000 6.7 741,654 7880000 6.2 Large Users (8-2) 2.664,658 21999,000 12,5 3,159.162 3 493,0(10 10.6 Total 3,3499468 3,730,000 11.4 3,900,816 412819000 9.7 Municipal 1679810 168,000, - 167,810 212,000 26.3 Lighting Service Street Lights 51,073 96,000 84,4 52,073 969000 84.4 Dusk to Dawn Lights 25,x,,229 3_„ 3,000 30.8 25,229 33,000 30.8 Total 770302 129,000 66.9 77,302 1290000 66.9 Tots), Retail 509319957 6,708,000 13.1 617170979 705381000 12.2 (a) includes actual FY 1974 revenues from fuel cost adjustment TYPICAL BILL COMPARISON In Tables 6 and 7, typical bills under present and proposed rates ate compared with bills for several other utility systems in Texas. It should • be cautioned that because of the many cost related differences such as type of service area, rate of growth, tax requirements, etc. which exist between utilities, these comparisons are useful for general information only. All bills shorm in fable 6 are based on rates and fuel adjustment charges or fuel costs as of Jr..suary, 1975. Table 7 represents estimates of typical bills applying the same cost of fuel (Denton's approximate cost of fuel at year end 1974) to all system. This analysis indicates a favorable comparison of Denton's present and proposed rates to the present rates of other systems. 23 TABLE 6 OENTON, TEXAS ELECTRIC UTILITY TYPICAL BILL COMPARISON i Denton-Ex{sting Rates Dallas Power 6 Light Co. Texas Power t light Co, Bran Texas Garland,-Texas Greenyl Greenvllle, Texas Basic Fuel Basic Fuel Basic Fuel Basic Fuel De crl tin Rate Ad ustment(°) Total Rate AAdlu_ 5 stm_ent(°) Total- .Raja . Ad ustment(°) Total Rate Ad ustment(l) Total BRate AdFustmcnt(I) ota) Basle Adl Basle Fuel Rat Ad ustme,ht (I) Total Fuel Cost Per M1111on BTU (b) 0, ~ OS SS s 0,21 0,28 0, $ 2D 0,24 -f- p p O,S4 - I $ $ $ $ 0.34 (9) _ 0,20 0 Residential, Summer 0,20 0117 Designatlon A-1 R-S RS-1 R RS L-1 I Date Effective 1/65 8/74 3/74 2/25/75 L-I 100 kWh 4,32 U,72 5,04 4,48 044 4,82 S 14 0132 5,46 4,49 0,16 i $,45 4.16 0,45 4,61 4,56 0 254 kWh 1461 1019 9,40 8,38 OA 9,22 915 0.80 9495 8.71 1,89 10,60 8,28 1,12 `.9,40 8,42 I500 kWh 11488 3,58 15,46 13.55 1,68 15,23 14,28 1,61 15,89 13,48 3,78 17,26 13,28 2.23 15,51 14,21 2 4.56 0,48 5,04 8,42 1,21 9,63 750 kWh 16,16 5037 21,53 18,73 2,52 21,25 19,40 2,41 21,81 18,26 5.67 43 18,28 3,35 21,63 19,55 3. 14,21 2,42 16,69 L,000 kWh 20,43 7,16 21659 23, 19.55 3462 23.17 00 kWh 23,90 3,36 27,26 24,53 3,21 27 74 2; 03 7&56 1$5 23,28 4,47 2745 24.82 4 5 28,98 10,73 3901 33,48 5,04 38,52 ;4,01 4.82 38,83 32o58 11034 1 34,82 4,83 29,65 3,000 kWh 'k92 32,62 6.13 39d32 35,91 54,63 21,47 76,10 60,93 10,08 4 61,46 9,63 11,02 61,23 22,66 6,5F, 58,12 13640 71,52 61,77 14. 35.37' 7025 42.62 06 kWh 86,49 35,78 122,27 97,53 16,80 1114,33 98,06 16,o5 114,11 99.43 37,80 ;137123 92,12 22,33 114,45 96,97 24, 61,17 14,49 76,26 96,97 24,15 121`.12 Residential, Winter 106 kWh (Same as Summer Rate) 4,48 0,34 4,82 S,14 0,32 5,46 4,49 0'76 250 kWh 5,25 Game as Summer Rate) (Same as (Same as summer Rate) 9,22 9,15 0480 9195 8,71 1,89 10,60 700 kWh 8 0,84 13, S 1,68 15,23 14028 1,61 15,89 13,48 3,78 17,26 150 kWh 17x89 2,52 I! Al 18,58 2,41 20,99 17,#95 5,67 29662 1,o30,kwh 21,84 3836 2 ,20 22,3 3. 23,74 21,177156 (28,73 OO kWh 29,74 5,04 3x',78 30, 3 4,82 35,25 27,62 11,34 38,96 MOO k 53,44 10,08 63152 54,13 9,63 63,76 46,97 22,68 69,65 S,oDO kWh h 85,04 16,80 101,84 85.73 16,05 101,78 72,77 37,80 110,57 Commercial Designation B-1 GS GS-I GS-S LC Date Effective 1/65 8/74 3114 2/25/75 -3 X0-3 25% Load Factor 100 kWh - I kw 3,78 002 4,so 5609 0,34 5.43 5,66 0,32 5.98 5639 0,76 6115 4.61 0,45 5.06 5,62 h) 0, 250 kWh - I kW 9,45 1079 11,24 11,66 0,84 12,50 13,08 0 80 13,88 1213 189 14 02 10,46 112 11 58 :0,06 h) 5,62 h 0,48 6.10 1 500 kWh - 3 kW 18,90 3158 22,48 20,59 1,68 22,27 22,73 1061 24434 2;,35 3 78 27,13 20,21 2,23 22,44 23197 2, ;4,06 h) 1121 11,27 750 kWh - 4 kW 26,78 5,37 32,15 29,54 2,52 2,06 2o 4l 1,000 kWh 3 31,35 51 21 33 76 33 34 5 61 39 01 26 64 3435 305944 0 19 31139 3s e 5 kW 34,65 1,16 41,81 38,50 3,36 41,86 40 3,21 4;,72 38,39 7,56 45,95 33,34 4.47 37,81 11,22 4, 1139 3.62 26,2 1 35,21 I , 500 kWh - 8 kW 48,15 10, , 10,73 1088 54 02 5,011 S906 S8,51 24 4s82 63s06 48,49 d) 11 ;4 S9 83 46;4 6.70 53,04 54 05 1 !1,22 4,83 4205 3,000 kWh - 16 kW 88,65 21,47 110,12 98 38 10,08 108,46 109 S4 9 6; 119,17 80641 )22 68 1103 39 82.89 13M 96029 lot, 26 its. ;4,05 7.25 61,30 5,000 kWh - 27 kw 137,25 35,78 173,03 158,06 16180 174,86 164,40~~) 16 05 180.45 138,63 d 37 80 176 43 124 8g 22 33 141 22 160 96 24 0-it. Ih no lot -or 1 ~ 25,000 kWh -137 kw 5 240-75 0,75 178,88 689,63 644,52 84,00 728,52 626 21:40~J) 31*10 328,60 265.49 )85,60 341,02 218,30"' 44,65 322,65 303,46 48, ~w-s 1 80,25 701,65 613,12 ~8g,00 e02,12 615,80 111,63 127,4; 643,46 120, i r 24 t~ n 1. 1 r .K rX TABLE 6 (Cont'd) • DENTON$ TEXAS ELECTRIC UTILITY TYPICAL BILL COMPARISON I _ Denton• j1t11Lq Aates Dallas Power b Llcht.5o _T'exa_ s Poser b l Des rl lion Basic Fuel ia) Basic Fuel ~a~ Basic F'ue; Orvan. Texa Garland Te+•~ _ g Ad u ment Total Rate Ad ustment Total Rate gd UStment(a) otal Basle _ ~reenvllle Tax~__ 9as1c Fue1 AdFuelment T I BRata AdF $ ustment~t) Basic Fuel Cost Per Million BTU (b) S $ S $ ; S --r - s - ..j..$ Total te ; 0,25 0.55 0.21 0.28 0.20 0.24 0,30 n,54 S S $ I ate Ad s m n To_otta_1_ Large Commercial ! o,34 (9) 0,20 0,20 0,37 De$IgmatIof) B, 2 Date Effective 1165 8LGS LP-20 lP•IK; LP-2(e) 3174 2125115 CS.L LC-3 LC-3 4096 load Factor 25 kW - 71300 kWh 178 052 4 230 20;N 25 228 196 23 2f SO kW • 14,600 kWh 300 104 404 c) !13 SS I 228 187 100 kit • 29~~OGO kIfi 1 Sf,042 9 S22 209 12 1►121 1628 49 394 331 4! 38 313 Ito 33 220 198 250 kV • ~ 1 628 98 726 595 9 689 5991 22i 8 2 S92 130 392 344 198 500 kW - 1 4b,000 kWh 1,845 1 245 10574 1009 234 1549 1 263 722 617 344 rjl 415 1,000 kW • 292,000 kWh 0045 2,690 2,241 491 2,732 2,245 469 2,114 2,192 1;504 1815 1, 13 326 1,639 1,436 2,500 kW . 730,000 kWh 3,214 2,089 5363 40054 481 5,o3S 3►960 931 4,897 3,900 2,206 6~,I96 3944 1652 521 281 2'80 p 304 1509 5223 12,732 9,493 20453 11,946 90107 2,343 11,450 9,025 50319 14,544 8,954 3,265 12821; 13,132 1,617 ! 1061 I3.5758 0g , 2802 5 60% load Factor 0 5,534 1,110 60944 25 kW • 10 95d kNh c215 78 3 246 ) 13,730 3626 17j256 50 kW - 2190o kWh 362 157 519 4 c) 37 283 248 35 283 216 83 3 100 kit • 43,$00 kVh c) 74 505 418 01 233 49 282 599 31 /0 488 403 166 1 569 416 254 250 303 250 kW - 109,500 kWh 1;217 912 799 141 97 106 946 756 141 8 ~ $14 429 3 3311 I ,031 152 196 948 788 429 106 535 500 kW - 219,000 kWh 78 2,OO1 1,591 3&S 19959 1,610 351 1,961 I,S31 3 828 788 212 1,000 i,0oo kW • 438400 kWh 4,0 0 3,534 3'144 4642 736 3,318 21690 703 3093 20681 1656 4319 1,641 489 2,130 1,863 1,863 529 20392 2,500 kW -I,o95,Da0 kWh 701857 1,471 6028 4,651 1,406 6,257 4,818 3,311 8,18 4, 64 1;nS6 6;8x0 7j243 9,349 1,835 (7,184 11,500 3►679 15,179 11034 3,657 1,058 41115 3,515 14j849 111470 8,278 19,74811,253 4,889 16,142 18,001 7,243 21116 9059 18,001 51789 23,290 a) Based on fuel adjustment applicable to January, 1975 bills. b) Fuel cast darlyed based on actual fuel cost adjustment rate and rate formula, c) Rate OS; Rate LGS has minimum billing 'demand of 100 We d) Rate LP- I; Rate SC allows maxin,uri demand of 15 kW, (e) Rate lP•I applicable to demands from IS to 350 kW; Rate LP-2 epplicable to demands over 300 kW (f) Rate GS-L; Rate 05-S has maximum demand of 30 kW, 9 Fuel cost not determinable from rate formula, h3 Rate LO-1; Rate LC-3 has minimum demand b1111ng demand of 5 kW, JI) Indicated by source material to be based on cost of generation January, 1975, k Rate LP-20 1 25 TABLE 7 DENTON, TEXAS ELECTRIC UTILITY TYPICAL BILL COMPARISON AT $0.82 PER MILLION BTU FUEL COST - Denton. Texas Dallas, Texas Existing Proposed Power S Power & Bryan, Greenville, Rages ! $ Rates $ Li Liahc Texas Texas Description Reatdential, Summer Posignation A-1 A-1(8) A-2 RS a5-1 R L-1 100 kWh 5,06 5.20 7.15 5.21 5.96 5.22 5.37 250 klih 9.46 9.76 11.28 10.21 11.20 10.53 10.47 500 kWh 15.59 16.16 18.15 17.21 18,37 17.12 18.36 750 kWh 21.72 25,03 24,22 25.54 23.72 25.69 1,000 kWh 27.84 - 31,90 31.22 32.71 30.31 33.00 1,500 kWh 40410 - 45,65 44.46 46,29 43.50 47,65 3,000 kWh 76,86 - 86.90 82.89 86001 83,07 86.32 50000 kWh 123.54 - 141.90 134.13 138.98 135.83 137.89 Residential, Winter 2 0 kWh kWh (same 5.20 L IS 5,21 5.96 5.22 (Same 9176 11,28 10,21 1140 10.53 as 5010 kWh summer 16x16 18,15 17.21 18,37 17,12 summer 750 kWh rate) 2244 24,93 23.38 24,72 23.41 rate) 1,000 kWh 28.93 31,33 29,16 30,71 28,45 1,500 kWh 41.73 44,13 40.72 42,71 38,54 3,000 kWh 80,13 92453 75,40 78.68 68.81 5,000 kWh 131.33 133,73 111.64 126.65` 109.17 Commercl.al Designa:;ion B-1 B-1 CS GS-1 SC LC-3 25% load factor kWh kW 100 - 1 4,52 5.47 5.82 6.48 6.12 6,44(d) 250 - 1 11.30 12,42 13,49 15,13 13,95 12.11(d) 500 - 3 22,61 24.00 24.25 26.82 26.99 27.96(d) 750 - 4 32.34 34400 35.03 37.49 38.80 37,73 11060 - 5 4246 44.00 45,82 48.69 45,67 45.40 1000 - 8 59,27 61,75 65.00 70,52 59,41 66,33 3,600 - 16 110.88 115,00 120,34 134.09 10245(e.) 326.81 5,000 - 27 174.30 19044 194,66 201.60 175.03(c) 101.88 100000 - 55 314485 377,50 37548 310,90 338.29(c) 381,90 (b) 26 ac' A TABLE 7 (Ccnt'd) DENTON, TVUS ELECTRIC UTILITY TYPICAL BILL COMPARISON AT $0.82 PER MILLION BTU FUEL COST Denton. Texas _ Dallas Texas Existing Proposed Power & Power 6 Bryan, Greenville, Rates Rates LIS- t Light Texas „ Texas Description Large Commercial LP-1 Designation B-2 B-2 LGS(e) LP-20 6LP-2(f) LC-3 40% load Factor kW kWh 25 71300 232 256 256 256 236 258 SO ,14,600 408 460 452 456 419 463 100 29,200 728 815 842 834 $04 856 250 730000 1,590 19797 1,863 10906 11794 2,033 S00 1469000 2,927 39,313 3010 30440 30255 30997 10000 2929000 5,438 60204 61191 6,350 60026 79924 2,500 7300000 12,918 149805 14,837 159081 141339 19,704 61% load Factor kW, kWh 25 100950 296 329 326 338 298 340 50 21,9$0 524 591 591 597 562 608 100 430800 924 1,041 10120 11114 1,025 11146 250 109,500 2,079 29358 21393 20506 20348 2,759 S00 219,000 3,853 49396 4,245 49482 49275 5,449 1,000 438,000 70256 8,321 8,136 89436 89067 100828 2,500 1,0959000 11,463 200098 19,515 20,295 199442 26,692 (a) Maximum 700 kWh allowed under this rate during eummer months. (b) Rate 8-2 (c) Rate LP-1 for demands over 15 W. (d) Rate LP-1 (e) Rate GS for demands under 100 W. (f) Rate LP-1 for demands under 300 kWi Rate LP-2 for demands 300 kW and over. 2, 1 „,„p wWr VP ~,.y Sa t y•W+ 4~, ,4 "nip" Y~~x b?N ~~Z'+n k "r7r , d f ,W r. 4 rY.a \ 4 y+"~M s y rw , c. r v~y '}.f. ✓ .tu ~ 1r ~ F `ir - ~ 37~ y, 1 y'0' r ✓kG ' r ~I i 11. I + t°~ t y r ~ f ~.Y Y 1'f: SmxVti`~,r APPENDIX A Froposed Rate Schedules II F, 4 .j 1 AI 7 , r fP k F ~ W r ~ ' ~ gar 9 iK . ' f i 1 w+ 'IT PROl`OSED ELECTRIC RATE SCHEDULES (a) tesidential Service Rate Schedule A-1 (1) Net Monthly Rate: Billing months of May through October First 50 kWh @ $3.15 Next. 75 kWh @ 4.090 per kWh Next 75 kWh @ 3.010 per kWh Next 500 kWh @ 2.560 per kWh 1.111ing months of November through April First 50 kWh @ $3.15 Next 75 kWh @ 4.090 per kWh Next 75 kWh @ 3.010 per kWh All additional kWh @ 2,560 per kWh Energy used during each of the months of November through April which is in excess of 700 kWh will be supplied at 1.650 per kWh if the entire home is electrically heated - heat pump or resistance. (2) Minimum Charge: $3.15 prr month (3) Availability: Rate Schedule A-1 is applicable to all electric service required for single family residential purposes where usage is not in excess of 700 kWh par, month during the billing months of June, July, August, or September. In any such month if usage exceeds 700 kWh, billing will be rendered that month under Rate Schedule A-Z and thereafter for, a period extending through the 12 billing months of the next fiscal year ending September 30. In instances where multiple dwelling ur;its (family or housekeeping units) are being served through the same meter as of the effective date of this rate schedule and the kWh in the billing months of June, July, August, or September does not exceed a total of 700 kWh times the number of dwelling units so served (and has not exceeded such total during the next preceding billing months of June, July, August, or September), the number of kWh in each block of the rate and the minimum charge will be multiplied by the number of family or housekeeping units. In any such month if the total kWh exceeds 700 kWh times the number of dwelling unite, the billing for that month and thereafter will be rendered under Rate Schedule A•-2. A-1 . j.:. .`7. ';;Y ,I ft 1 r '1.-: ~:.2 xru x~," a ya .}:.Y 4 t~~.,,r, , i; 'i (4) Service., Single pease service at utilization voltage will be supplied here- under. In the event three phase service is required by the user and is available at the premises to be served, a charge of $100.00 will be made for such installation. (5) Payment: Billing for service hereunder will be at the net monthly rate, payment of which is due when bills are issued. Bills which are not paid within 10 calendar days from the date of Issuance there- of will be considered overdue. Service to users having overdue bills may, at the discretion of the Utility, be discontinued without notice, and a charge of 10 per cent of the billing sht.ll be paid by the user in addition to the net monthly amount. There shall be a charge of $4.00 for reconnecting such discontinued service. (6) Fuel Adjustment: All charges of the Net Monthly Rate will be increased or decra.ased 0.0122e per kWh for each whole 0.01: per kWh by which the average coat of fuel used in the Utility's electric generating plants* plus the cost of purchased energy during the calendar month next pre- ceding the billing month is above or below 1.UOe per kWh. Such average cost is determined based on the sum of net kWh generated in the Utility's plants* and the kWh purchased during each said month. The cost of purchased energy does not include demand charges for purchased power or rental charges for facilities. *The determination of cost of fuel and net kWh asneration will exdlude the 'cost of specific fuel purchased for and the related kWh generation supplied for off-system contractual sales. (b) Residential Service Rate Schedule A-2 (1) Net Monthly.Rates Billing months of May through October Fixed cost of $4.tO plus All kWh @ 2.75c per kWh Billing months of November through April Fixed cost of $4.40 plus First 700 kWh @ 2.75e per kWh All additional kWh @ 2.560 per kWh A-2 x ,y e 9"7 SL+:T' ._tT Energy used during each of the months of November through April which is in excess of 700 kWh will be supplied at 1.85,C per kWh if the entire home is electrically heated - hert pump or resistance. (2) Minimum Charge: $4.40 per month plus the charge for energy used. (3) Availability: Applicable for single family residential use. Where multiple dwelling units are served through the same meter, the fixed coat and the number of kWh in each block of the rate will be multiplied by the number of family or housekeeping units. (4) Services (Same as Rate Schedule A-1) (5) Payment (Same as Rate Sc%edule A-1) (6) Fuel Ad ustment: (Same as Rate Schedule A-1) I A-3 1 i. .,6, T .r 1J } ♦ ~4rvi~'.r ' nsi~~ ~4?"dfY;' . r .fir. . y r r .+r ~ 'f K Y .i 11 r.. 5.,. (c) Commercial and Industrial Lighting and Power Service Rate (O-Approximately 20 kW Demand) Schedule B-1 (1) Net Monthly Rate: First 50 kWh @ $3.15 Next 450 kWh* @ 4.63C per kWh Next 500 kWh @ 4.000 per kWh Next 2,000 kWh @ 3.55c per kWh Next 2,000 kWh @ 3.28C per kWh All additional kWh @ 2.920 per kWh * For each kW of Demand in excess of 20, add 100 kWh to the 4.630 block. (2) Minimum Charge: 53.15 per >ronth plus $1.70 for each kW of Demand in excess of 10 kW based on the highest Demand established during any month of the preceding 11 months. (3) AvailableI AvaiiA le to commercial Lnd industrial users having a power require- ment 1A approximately 20 kW or lees, except that service hereunder is nci available for resale, breakdown or standby power. (4) Demands The kW load metered during the 15-minute period of maximum use during the current monthly billing period. (5) Services At the utility's available secondary voltage and phase. (6) Payment: (Same as the payment conditions under Rate Schedule A-1.) (7) Fuel Adjustment: (Same as the fuel adjustment under Rate Schedule A-1.) A-4 `$K~yT wT "Wtni .r .hr YV ^ti13S,. vS~ ry,c ~:i y~. yq.N{{ 'lk i.'yyr T'cq .~J T^', } al. t' ti i L~ • I (d) Commercial and Industrial Lightiag and Power Service Rate For Medium and Large :sage) Schedule B-2 (1) Net Monthly Rate: Demand Charges $40.00 per month for the first 20 kW of billing demand $ 1.50 per month per kW for the 80 kW of billing demand $ 1.30 per month per kW for all over 100 kW of billing demand Energy Charges 2.851 per kWh for the first 300 hours use per month of the billing demand, but not more than 10,000 kWh 1.95E per kWh for the next 180 hours use per month of the billing demand, but not more then 60,000 kWh 1,550 per kWh for the next 200 hours use per month of the billing demand 1,450 per kWh for all additional kWh per month (2) Billing Demands Equal to the kW load metered during the 15-minute period of maximum use during the current monthly billing period. The billing demand for service hereunder shall not be less than 20 kW. (3) Minimum Charges An amount equal to the demand charge as calculated above but not less than 50 per cent of the maximum monthly demand charge for any month during the preceding 11 months. (4) Availability: Available to coae,ercial and industrial users having a connected load of approximately 20 kW or greater, except that service here- under is not available for resale, breakdown or standby power, (5) Commercial Residential Uses Multiple apartments containing a minimum of five units may be served under this rate. If in such service all apartments are electrically heated - heat pump or resistance - the power and energy used during each of the months of November through April will be supplied at the following modified rates A-5 ,Y~ a1 ^'u ~1~~ ~ 1~ y ;F!'n }~'r Ye ru i t 1< P. .u v r "k 9. L `4 14r For the Demand Charge only, the Billing Demand will be adjusted by multiplying the 15 minute metered rate of maximum usage during the month by fifty per cent (502). The adjusted Billing Demand so determined will not be less than 20 M (6) Service: At the Utility's available secondary voltage and phase. In the event the Utility elects to meter the User'o service at the high voltage windings of service transformers, the User will be allowed a two per cent (2%) reduction from the net billing. (7) Payments Same as the payment conditions under rate Schedule A-1. (8) Fuel Adjustments Same as the fuel adjustment under rate Schedule A-1.. 1A, (9) Power „Factor Requirements and Adjustments The Oh lity reserves the right to make tests to determine the power factor of the User's installation served hereunder during periods of maximum demand or by measurement of the average power factor for the monthly billing period. Should the power factor so determined be below 90 per cent, the demand for billing purposes will be determined by multiplying the unconnected kW Billing Demand by 90 per cent and dividing by the determined power factor. (10) Alternate Primary Service and Discount (Transformation Equipment Owned by the User)t Primary service will, upon request, be made available to users with a 12 month average monthly demand of 750 kW or greater. Primary service will be rendereli at one point on the user's premises at a nominal voltage of 13,200 volts or 69,000 volts three-phase, at the option of the Utility. When the alternate primary service is supplied, the user shall own, operate and maintain all :'ac.Mties necessary to receive primary service and all transformation facilities required for conversion to utilization voltage. The Utility shall own, operate and maintain all metering facilities (either primary or secondary metering at the Utility's option). A-6 ,ice T-P og Where the user owns operates anel matettonapply its transformation equipment and where the Utility TI, re fteenrpetfceennttt(15%) facilities the on the ueehr $ili beaallowed affi p Charge. reduction from the monthly Demand r owns, operates and maintains the transformation Were the use equipment and where the Utility elects ~o apply its metering facilities on the low voltage side of such transformation equipment, the user will bepemandeChargesr!hendifference(13x) reduction from the monthly et sent being the allowance for between 15 per cent and 13 p - losses in the user's facilities, 1 A-7 713 T (e) Dusk-to-Dawn lighting (1) Net Monthly Rates 115 watt Mercury Vapor Lamp $4.35 250 watt Mercury Vapor Lamp* @ $5.35 400 watt Mercury Vapor Lamp @ $7.00 * No ne» or additional 250 watt lamps will be installed after the effective date of this schedule. Where necessary for proper illumination or where existing poles are inadequate the city will install or cause to be installed one (1) pole for each installed light, at a distance not to exceed eighty (80) feet from said existing lines, at no charge to the customer. Each additional pole span shall not exceed a span spacing of one hundred (100) feet. Additional poles required tc install a light in a customer's specifically desired location, and not having a light installed on same, shall bear a cost of one Hundred Sixty-Five Dollars ($16;.00) payable by the customer prior to installation. (2) Available: To any customer within the area served by the City's Electric Distribution System for outdoor area lighting when such lighting facilities are operated as an extension of the City's Distribution System. (3) Service: The City shall furnish, install, maintain and deliver electric service to automatically controlled, mercury vapor lighting fixtures conforming to the Utility's standards and subject to its publie!-,ed rules and regulations. (4) Payment: (Same payment conditions as under Rate Schedule A-1) A-8 e 1~ .'4' 4 M a ..rd t. ~i:w \ "'.1 'a~ fi F`yr` r ,.'~}HAY. rr (5) Term of Contract: A two 12) year contract shall be agreed to and signed by each customer desiring Dusk-to-Dawn Lighting Service authorizing fixed c►onthly charges to be applied to the monthly municipal utilities bill. In thi event that a customer desires the removal of the unit or discontinuance of the service prior to completion of two years, the remainder of the contract shall become due and payable. After the completion of two years, service shall continue on a month to month basis and may be cancelled by either party upon 30 days notice. A-9 o kk,, . t 4 iL~{ fi,r ",w' h n j V 5.,'y r p i'ni r Y.;"rp ' i~!r't ~ ,i n ahi~r ?rl+ it 4 T4i. 11; i~-~ ~ ~:~;C~ ~is4~ ^ ^~1T 1~ yea f a G•..,. Y, ~i { y1x~4r " ret n" «'°$`r~rq{ Y•°' a r,{ 2 . r. ~4LM y e.c ~1 J r h ~L + );'+Gf 'a r f ,~~LL, p J~.~' r h s n b ~ i ,.55vy r i s ,uhf e 4` Y I i APPMIX B ti+"* Preaer4t_itate Schedul®o r l r M r ~ r i Oy~Xr~,. 4i`~,f,f •vS r • • i IrY I I , r 1 u r'4 A A t z 9 x r a +„Y rl d Y p ✓ ti riff !r„r "'s de,'~8^^'~bY ~i~ nGX .l r ~i•~~~~4'~ iv ~ ±{Z y~ _ ~ ~ J.'. ! t,~7f' ~1~' ~ 1. 1. q r!° i c - _'~'7si" 9 ~ 3y w .r_ fi . AN ORDINANCE AMFNDING THE CODE OF ORDrNANCES OF Tilp CITY OF DENTON# TMSs PROVIDING NLV MONTRLY RATES IITIL171Y SERVICE: PROVIDIN¢ A PENA1,Ty OR FOR ELECTRIC PROVIDING CERTAIN OTHER REGULATIONS AND OVERDUE PAYMENT; TA POLICY. REPEALING CONFLICTING ORDINANCES PROVID OF SAVINGS CLAUSE! AND DECiA RING AN EFFECTIVE DATE. TH9 COUNCIL OF 7HE CITY OF DENTON HEREbY ORDAINS SECTION I That the Code of Ordinances of the City of Dentons Texas, to hereby amended and supplanted by substituting new subsections (a)s (b) and (c) of Article 17.09 in Chapter Seventeen of said Code of Ordinances which shall hereafter read as followal A_ RTI~LE 17 09 - ELECTRI I+ATE (a) den a arvi_~e Ito (1) et H nthl___-y Raton First 50 kwhr. 0 5.400 per next 75 kwhr 0 3.2.40 kwhr Next 75 kwhr 0 2.150 per kwhr p Next 3500 kwhr 0 1 710 kwhr per All over 3700 kwhr 0 1.530 kwhr per kwhr Energy used during each of the months of November througl,,April which is in excess of'700 kwhr will be supplied at'0.90 per kwhr if the entire home is electrically heated - heat pump or resistance. (2) s~inirnumgo, $1.00 (3) Ava`ilabilityf Applicable for single family residential use. Where multiple dwelling units are served through r the came mater s the number of kwhr in each block of the rate and the minimum charge will be multiplied by the number of family or house- keeping units. (4) S_..._._v_._ r Single phase service at utilization voltage will be supplied hereunder. In the event three service is required by the users a charge phase $100000 will be made for such installation. f - ~ / d ~1 Y fy ♦y. (5) Pa men ~ ; Billing for service hereunder will be at tho not monthly rate, payment of which Is clue when bills are issued. Bills which are not paid within 10 calendar days from the date oi( irnsuance thereof will be considered overdue. Service to users having overdue bills may, at the discretion of the Utility, be discontinued withaut notice, and a Charge of 10 per cent of the billing shall be paid by the uhcr in addition to the net monthly amount. There shall be a charge of $3.00 for reconnecting such discontinued service. (6) Fool Adjustment: An amount of 0.00134 per kwhr will be added for each 0.10 by which the average cost of fuel used in the Utility's electric generating stations { during the preceding calendar month e ? ede 25¢ per million Stu. (b) Commercial and industrial Liahtina and Paver Service a o (0-Approximately 20 kw Demand) S Nadu a B_1 (1) Nat_Monthlk Rate: Pirot 500 kwhr 0 3.784 per kwhr Next 50r kwhr ® 3.154 per kwhr Next 2,000 kwhr- ® 2.700 per kwhr Next 2,000 kwhr Next 5,000 kwhr ® 2.434 per kwhr All over 10,0'00 kwhr 0 2.074 per kwhr ® 1.604 per kwhr (2) Minimum charge: $1.00 per kw of connected load (3) Availability: Available to commercial and industrial users raving a power regviroment of app.,:oximately 20 kw or leas, except that service hereunder is not available for resale, breakdown or standby power. i (4) commercial Reri.dentfal Use: Multiple apartments containing a minfrcum of five (5) units may be served under this rate. if in such service all apartments are electrically heated - heat pump or resistance - the energy used during each of the months of November through April which is in exceos of 250 Ywhr multiplied by the number of apartment units will be supplied at 0.94 per kwhr. (5) Service: At the Ut'lity's available secondary voltage and phase. (6) Demand Limita tion_gr If the User's measured demand is in excess of 20 kw for two (2) consecutive months or if the monthly consumptian of energy is in excess of 8,000 kwhr for two (2) consecutive months, subsequent usage will be at the option of the Utility be billed at the rates applicable under rate Schedule 8-2. (7) Pa of is Same as the payment conditions under rata Schedule (8) uol Ad a en same as the fuel adjustmont under rate Schedulo A•• 1. (e) ' Co Oz eiaand industrial L+~htina and Powur Sorvlee Iuite (For Modicum and Large Usage) 6chedula 8 j? • {1) ~.~~~1v Rater Demand Charges $36.00 per month for the first 20 kw of billing desrwind $ 1.35 per month por kw'for the next 80 kw of billing demand $ 1.125 per month per kw for all over 100 k,, of billing demand Energy Charges 2.1154'per kwhr for the first 180 hours use per month of the billing demand, but not more than 50000 kwhr, 1.444 per kwhr fur the next 120 hours use per month of the billing demand, but not more than 5,000 kwhr. 0.994 per kwhr for the next 180 hours use per month of the billing demand, but not more than 600000 kwhr. 0.634 per t:whr for the next 180 hours use per month of the billing demand, . 0.5044 per kwhr for all additional kwhr per month. • 8111ina nernande Equal to the kw load metered during the l5-minute poriod of maximum use during the current monthly billing period. The billing demand for service hereunder shall not be less than 20 kw. , t+ ffs i- (3) Mir}jm= Cb9JLq s An amount equal to the demand charge ar calculated above but not less than 50% of the maximum monthly demand change for any month during the preceding 11 months. (4) Availbl! Uitys i Available to commercial ►nd industrial users having r connected loa.l of approximately 20 kw or greater, except that sor%r;;ce hereunder is not available for rovale, breakdown or standby power. (5) Commercial Residential Usoi Multiple apartments containing a minimum of five units may be served under this rate. if in such service all apartments are electrically heated - heat pump or resistance - the power and energy used during each of the months of November through April will be supplies] at the following modified rates Demand Charge - the billing demand will be adjusted by multiplying the 15-minuto metered rate of maximum usage during the month by the factor 350 kwhr x Aumbor o2 t+trtme1.t unite ) total measured kwhr This adjusted billing-demand will then be applied to the rate Schedule B-at provided, howovor, that the adjusted billing demand for service hereunder Aell not be lees than 15 kw. Energy Charge - an amount of energy equal to 350 kwhr multiplied by the number of apartment units will be supplied at the basic rate of this Schedule n-2, using the adjusted billing demand to determine the Energy usago under the respective blocks of the rate. All addi- tional energy will be supplied at 0.94 per kwhr. if a lower monthly billing would result, the demand and energy will be billed in accordance with Schedule B-2 without adjuptmant. (6) setvic s At the Utility's available secondary voltage and phase. in the event the Utility elects to motor the Usor's service at the high voltage windings of service transformers, the User will be allowed a two per cont (290 reduction from the not billing. (7) P_ a_y_ments Same as the paynent conditions under rate Schedule A-1. (S) Fuol AdiustmentI Same as the feel adjustment under rate schedule A-1. (9) Power Factor Rec~uirtmgnte and Adiudtments The Utility reserves the right to make tests to determine the power factor of the User's installation served hereunder. Should the average power factor for the monthly billing period be boluw 9076 or above 95% lagging, the demand for billing purposes will be determined by multiplying the uncorrected billing demand by 92.5% and dividing by the average • power factor so calculated. (10) Alternate Primary 6eryi~ an a s nation F,quinment Owned by ! e U Primary service will, upon ,request, be made available to users with a 17-month average monthly demand of 750 kw or greater. Primary service will r be rendered at one point on the user's premises at a nominal voltage of 13,20) volts or 690000 •i volts threo-phase, at the option of the Utility. When the alternate primary service is supplied, the user shall own, operate and maintain all transformation facilitiejs required for conversion to utilization voltage. The Utility shall own, operate and maintain all metering facilities (either primary or secondary metering at the Utility's option.) Where the user owns, operates and maintains the transformation equipment and where the Utility elects to apply its metering faeilitlan on the hl voltage sidn of such transfo,rrAtion equipment, the user will be allowed a seven per cent (7%) reduction from the monthly billing. Where the user owns, operates and maintains the transformation equipment and where the Utility elects to apply its metering facilities on the IV voltage aide of such transformation equipment, the user will by allowed a five per cunt (5%) reduction from the monthly b).llingt the difference between seven per cent and five per cent being the allowance for losses in the user's transfor- nation equipment. :w;r i ~t t y ',1 A q E BECT-- ION~II s That all ordinances or parts of ordinances in force when the provisions of this ordinance become offective or in conflict with the terms or p which are inconsistent rovisions ordinanco are hereby repealed to the extent of anynsuchnconflict. n ____-pLU , That any section, subsecti phrase or word in this ordinance, nce, ON paragraph, sentence, clause, or application thereof to any porson or circumstances is held invalid by any court of competent jurisdiction, such holding shall not affect tho validity of the remaining portions of this ordinanco, and the city Council of the City of Denton, Texas, hereby declares it would have enacted such remaining portions despite any such invalidity. s• ECTION IV That this ordinance shall become effective fourteen (14) days from the date of its passage, and th• city Secretary is hereby directed to cause the caption Of this ordinance to be published twits in the Denton REcord Chronfclo within ten (10) Rays of the date of its passage. PASRED AND APPROVED this Ile- day of A.U. 1965. ~ t i rren i Whit;3on, Jr., Mayor rity of Denton, Texas ATTEM 146ZGkF,- Holt, City secretary ' City of Denton, Texas i APPROVED As TO LEGAL MRMt JtY Q. Sartan, Cit ~y Attorney of Denton, Texas _ r. t E ! r 1i 17 1 E 100 _ i i' 1 I- :1. 'TM 901 Proposed A-1 t-bv to Apr Rate i.. Existing A-1 Rate 1 Fadsting A-1 All Electric Rats proposed A-1 All Electric Rate 1 { 1 70 E ~ 1 t t } 60 so J CITY OF ref" 1 JUNE 1975 ftWosed Ar FATE 1 m~irrAtt 4 40 may to oct. Rate M k COIPARISM ! Baas FU91 Oust 60 30 JWJ Cost Adjustment I of $0.00741/*M a E 1 E` on' bdsting Rates , 1 _ L_ i 1 AveralIe 1974 Mmth1Y Coc'a `10 L t I i i { 1 1400 1800 2200 2600, 3000 - , 200 600 1 1400 ;T ` 11 1 1i. t ILL' 1111 %I1111"Ittas U, the c'M lnetc3 1 *I ..lot)' 100. prqpowd A-2 xw, - Apr. Fite _ ' PLVPOBed A-2 May - Oct. Rate \ 90 Existing A-1 Rate Existing A-1 All Electric Rate PtOpaeed A-2 All Electric Rate 70 I AvU-ap 1974 !mthly C"uTption i I L 40 am or DEm JWE 1975 - { - R£4IDFNPIAL RATE 30 OCWARISON r - j ; - Base Fwa Coet of f . _ I. 62MOM -1 ~ AN1 Wit Ad ust~nt of - 1.. _ *00741/%V on _ flcfsting Rates ~ 10 77 E0 200 1000 1400 1800 2200 2600 r ! _ ~ 300 t IL 4 L Fr 1. A LL '1111~q, n.. l.Il l. i~lt I~tlllltlf t.l 4PI -7 7 _ _ r _7 7T" 280 9 t f- I ~I j~ j 1,260 r ~ I 240 f E 8 Rate 220 bating A Rate f 200 180 f.: f { f I CITY OF DER" 1.7 f + JU+W; 1975 f 160-- LL O b= RATE MARI9CN {Bl) I + Saw nal I 140 CABt Of $82/M"~'iV 7-1 f t! f I 'Fuel Cost Adjustment Wsting Rates . ` y 120 • _ f 8 $0.00741/ GM -1000 17, l00 t; 11 00 14 60 40 20 000 5000, 6000 7000 8000 9000 10,000 I k i ~ i + ~ ~ I { F64F1 f + z 7 t 5,"' y+ v'a ~ 3o~a. ~ 3 G 5 r•~ _ - - { T I r_. f , I I. a JT 177 • 1 ` I 3 6000 i 5000, ` , p ea B-2 Rate i , i - ~ r ~ i r 1 ~ I 4000 cny Of DM Ii y j . r { I,n= )MEM I 40% UAD FWWR 3000 a V ~'-X2000' ~ ~ • ~ ' ~ ~ ' i i ~ I , ~ 1000 I ' t •k ` - f ' I. i E_ r 800 10,000 KH (Demand) j 200 i i• ,I 4(0 I 600 i 233,600 292,000 68,400.._. L16 ,b00 ; 175,200 f .w