BPU customers can expect to see a slight increase in their June electric bill.
The second fuel cost rate adjustment by the New York Power Authority for the sale of its hydropower went into effect May 1.
The 5.4 percent rate adjustment will be reflected in the fuel cost adjustment line on the June BPU customer bills and will add approximately 60 cents per month on the average electric bill.
The first adjustment of 5.5 percent took effect on Dec. 1, 2011. The third adjustment of 5.6 percent will take place on May 1, 2013, and the fourth increase of 5.7 percent will occur May 1, 2014.
The Jamestown BPU challenged the NYPA board's proposed 29 percent rate increase last year; however, the NYPA board still voted to raise the rate, although it lowered the rate increase to 24 percent.
It's a balance, as it relates to challenging their desire for rate increases, but also seeing how we can work together to push forward projects that can benefit our customers," said David Leathers, BPU general manager, about working with NYPA.
POSITIVE FIRST QUARTER
"I felt we had a great first quarter. Revenues are up and expenses are significantly down," said Mike Anderson, BPU business manager. "I give all the credit to department heads. They work hard at controlling costs and it obviously pays off."
Each of the BPU's five divisions experienced a net income more than budgeted for the first quarter in 2012.
"If you look at each division, for different reasons, each of them have performed well for the first quarter," said Leathers.
The electric division finished the first quarter $1.07 million over budget.
"On the electric side, the gas turbine operating for the most part of the first quarter paid tremendous benefits not only to the district heating division, but also to the electric division," said Leathers.
The billed kilowatt hours sales decreased 6.9 percent compared to the first quarter in 2011, which Anderson said he attributes to the mild weather during the winter.
"We were in a situation where electric consumption was down, but with the gas turbine operating, we were able to provide cheaper electricity than we could buy or make with coal and also were able to take advantage of off-system sales and bring some dollars back to stabilize the results," said Leathers.
The district heat division was $308,000 over budget during the first quarter.
"District heat is a good start to the year, but basically over the next six months, it will go flat," said Leathers. "But, basically, that provides a good platform for the rest of the year."
Several factors attributed to this significant increase in net income. Heat sales were $122,000 or 13 percent more than budgeted, which was achieved in part from WCA Hospital coming back on line with district heat this year. Also operating expenses were $79,000 or 14 percent under budget, and energy costs were $104,000 or 33 percent under budget due to low natural gas prices and the LP Economizer Project.
"For the first time, waste heat from the LM 6000 was utilized with the LP Economizer to supplement the supply of district heat to (BPU) customers," wrote Anderson in the first quarter report.
"It's not only relevant what we burn and use as fuel, but also how efficiently we use whatever it is, and district heat was born to increase the efficiency of our electric generating station," said Frederick Larson, board member. "For every unit of natural gas bing burned in the turbine, we've extracted a little more usable energy out of it, and that's good for our customers and good for the environment."
The water division experienced an unusually good first quarter, as well, with a net income of $182,000, compared to a budgeted net loss of $4,000.
"The water division's budget is a very tight budget. We only budget $65,000 as the net income for the whole year, and the summer months are generally our big months, so it's not unusual to budget for a loss in the off months, the winter months," said Anderson.
A contributing factor was that the total operating expenses in the water division were $153,000 (13 percent) under budget, as the BPU only repaired 27 main breaks during the first quarter compared to 45 during the first quarter in 2011.
"The water (division) was stronger than normal in the first quarter, which had to do a lot with less main breaks and less call-outs in the winter time. I would say very good results for the first quarter," said Leathers
Additionally, the waste water division was $79,000 over budget and the solid waste division was $78,000 over budget.