Find out why NPPD must increase its electric rates for both wholesale and retail customers in 2010, and learn why NPPD’s electric rates are still a good value.
The Nebraska Public Power District is the state’s largest supplier of electricity to the people of this state. It generates electricity for nearly 400,000 Nebraskans, 89,000 of whom receive their electricity directly from NPPD at retail.
WHOLESALE
A wholesale customer buys electricity from NPPD in extremely large quantities – hundreds, if not thousands, of megawatt-hours* at a time.
NPPD’s revenues in 2008 were $831 million, and approximately 70% of that revenue was paid by other utilities in Nebraska who bought power for their customers.
NPPD sells electricity to 52 municipalities and 25 public power districts or cooperatives that re-sell the power to nearly 300,000 Nebraskans.
This is what a wholesale customer’s bill looks like.
2009 was a challenging year for NPPD and its wholesale customers. The weather was extremely mild which resulted in less load and revenue than anticipated, meanwhile reliability investments remain necessary.
5.9% (Individual percentage increases will vary depending upon the utility's usage patterns.) Reasons for the rate increase:
If approved, the rate adjustment will go into affect January 1, 2010. |
OTHER RETAIL CUSTOMERS
NPPD serves approximately 20,000 retail commercial and industrial customers.
Commercial Businesses – NPPD’s retail business customers may be as small as a coffee shop or as large as a grocery store.
Industrial - Businesses that manufacture products such as ethanol, electrical components, etc, will use more electricity and often operate around the clock.
Irrigation – Farmers pay a different electric rate for operating electric irrigation equipment.
Commercial Space Heating, Municipal Pumping, and Lighting (e.g. area, directional or street) also have separate rates.
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* 1 megawatt-hour = ten thousand, 100-watt incandescent light bulbs on for 1 hour
* 1 kilowatt-hour = ten, 100-watt incandescent light bulbs on for 1 hour
There are different classes of retail customers; the 5.7% retail rate increase is an average of the various rate classes including residential customers (see middle column). The following is the rate increase for each type of customer:
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RESIDENTIAL RETAIL
A residential retail customer buys electricity from NPPD for their home. The average residential customer uses approximately 1,200 kilowatt-hours* of electricity per month.
NPPD serves approximately 68,000 residential customers at retail. This means they receive a bill from NPPD for the services associated with generating and delivering the electricity they use.
Unlike most retail products (e.g. clothes, fast food, etc.), electricity is paid for after it is consumed.
This is what a retail customer’s bill looks like.
NPPD conducted a cost of service study in August and determined that its retail rates are not enough to cover the cost of service. NPPD must increase its electric rates for all retail customers in 2010.
6.0% (average for all retail rate Reasons for the rate increase:
If approved, the rate adjustment will go into affect January 1, 2010. |
