‘This is something that’s needed’: St. George approves ‘minimal’ power rate increase

ST. GEORGE — St. George residents and businesses will be seeing their power bills go up soon following the City Council passing a rate increase that was described as “minimal” and necessary due to a drop in hydroelectric power production.

Laurie Mangum, Energy Services Director for the city of St. George, speaks to St. George News about the city’s utility rate increases, St. George, Utah, March 2, 2023 | Photo by Mori Kessler, St. George News

In a short meeting Thursday, the council unanimously voted to increase power utility rates across the board along with an increase in the base rate for residential and small commercial customers.

The increase amounts to around a 2% increase in utility rates for the average household, Laurie Mangum, the city’s energy services director, told St. George News.

According to city documents, the rate increase is expected to raise revenue for the city power utility by around 8%. A further breakdown shows residential rate increases of up to 4%, small commercial rate increases of $12 and large commercial rate increases of 2%.

When asked why the city was increasing its utility rates, Mangum said it was due to the drought that has gripped the West for over 20 years now. Because of the drought’s increasing severity in recent years, water at Lake Powell has dropped to its lowest levels since the reservoir was originally filled in the 1960s.

As the water level dropped so too has the amount of power that has long been produced at Glen Canyon Dam. As one of the cities that received a portion of that electrical output, the city of St. George has been forced to look elsewhere to replace that dwindling source of power.

In this file photo, Glen Canyon Dam, Page, Ariz., June 10, 2022 | Photo by David Dudley, St. George News

“The drought … has brought a reduction in the hydro (power) we get from Glen Canyon Dam,” Mangum said. “It’s about one-third of the capacity that we’ve been getting for the last 40 years.”

The need to start looking for replacement power sources to add to the city’s energy portfolio was highlighted last summer and discussed more in-depth in a recent City Council work session. It was during that work session that Mangum showed the council how increasing power prices were impacting the city and emphasized the need for a utility rate increase in order to keep up with those costs.

“Our market rates for the costs for energy have gone up significantly,” she said in regard to the cost of existing power-generation sources on the market, as well as the sources the city has bought to replace the diminished hydroelectric output.

According to city documents, the base rate for residents and small businesses will be jumping from $19.65 and $13.55 respectively to $25 each. This increase is going toward the general services and upkeep provided by the city’s energy services department, Mangum said.

As for the power per kilowatt hour, residential customers have two tiers depending on how much power they use. Prior to the rate increase, the price for 0-800 kilowatts per kilowatt hour was 7.5 cents, with 800-plus being 9.1 cents. This will increase to 7.6 cents and 9.3 cents per tier.

The St. George City Council, St. George, Utah, March 2, 2023 | Photo by Mori Kessler, St. George News

“Our (energy services) department has done a very good job and serves us very well,” Councilman Gregg McArthur said prior to voting on the rate increase. “We haven’t increased utility rates in a long time. This is something that’s needed due to the cost of everything increasing and they’ve done very well to keep it as minimal as possible.”

While reliance on hydroelectric power has been impacted by the ongoing drought, Mangum said St. George has a very diverse portfolio of power sources, which includes coal, natural gas, hydroelectric, solar and wind.

“We feel we’re looking toward the future and the best we can to supply the city of St. George with renewable energy,” Mangum said.

Another source of power that the neighboring cities of Washington City and Hurricane are investing in is nuclear power. Specifically, those municipalities have bought into the proposed NuScale project to be built in Idaho Falls. Officially called the Cardon-Free Power Project, various Utah towns and cities are backing it through Utah Municipal Power Systems, or UAMPS.

Mangum said the city is not looking to buy into the project as Washington City and Hurricane have, yet is interested in purchasing a portion of its future power from the project once information on pricing becomes available for review.

The last time the city increased its power rates was 2014.

Copyright St. George News, SaintGeorgeUtah.com LLC, 2023, all rights reserved.

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