CUC hikes water electric fee

Just a week after increasing its rate for LEAC, or levelized energy adjustment clause, the Commonwealth Utilities Corp. will be implementing another rate hike, this time on the customer’s water electric charge.

Charles Warren, CUC’s chief financial officer, said yesterday that retroactive to April 16 this year, the water electric charge will increase from $2.90 per 1,000 gallons to $3.15 per 1,000 gallons-a 25-cent bump that translates to an 8.6-percent increase.

For the average residential customer, the impact will be about $2.25 monthly.

CUC enforced a new LEAC rate effective April 9, 2012, in the wake of continued oil price hikes in the world market. The new rate is $0.32910 per kilowatt-hour-a 7.725-percent increase from the LEAC rate of $0.30550 approved in January 2012. To average residential customers that use 500 kWh a month, the impact on their bills is $11.80 monthly.

When combining both the new LEAC and water electric charge, Warren said the impact on the average residential customer will be a total of $14.05 monthly. LEAC’s impact is $11.80 while water electric charge is about $2.25.

According to Warren, both water electric charge and wastewater electric charge are only adjusted when the LEAC electric rate is changed.

LEAC is part of the customer’s bill that reflects the cost of fuel. It is supposed to go up or down to reflect the cost of buying fuel to run the power plants. The other element of the bill is the electric base rate.

For the wastewater electric charge, Warren said that CUC decreased the rates, also effective April 16. From the existing $3 for every 1,000 gallons, it was reduced to $2.97 per 1,000 gallons.

Warren disclosed that the wastewater electric charge is currently not being charged to customers. At the January session, the Commonwealth Public Utilities Commission ordered the CUC power division to lend the wastewater division up to $2.85 million to offset the cost of electricity charges.

He said the water electric charge and the wastewater electric charge are to reimburse CUC for all electricity costs it incurs to produce, treat, and transport water and wastewater.

Like the new LEAC rate, Warren said the adjusted water and wastewater electric charges will be up for review by the CPUC once it reconvenes. “Everything CUC does on rates is subject to review by the PUC,” he added.

CUC projects to spend $25.454 million on fuel within six months. For February through July 2012, it forecasts to use up 8.4 million gallons of fuel for power production. The average gallon per month is 1.4 million with estimated cost of more or less $4.2 million.

CUC earlier disclosed that majority of residential ratepayers use 10,000 gallons of water and wastewater service a month. CUC has about 9,904 water customers and 2,887 wastewater customers.