Updated Sept. 22, 2018 - The Public Utilities Advisory Board received basis information on IPL’s revenue and expenses (2014-19) as it continues to look at ways to manage overall utility costs.
City Council Struggles with competitive utility rates
The Independence City Council has struggled on how to get competitive electrical rates.
IPL rates, in general, are higher than other area utilities including the investor-owned Kansas City Power and Light. IPL commercial and industrial rates are not competitive and IPL has a complicated rate structure.
In September 2015, the City Council voted unanimously to indefinitely postpone changes in IPL rates in September 2015 but there is growing pressure to make changes in the rates.
A 2017 management report made a strong case for rate increases recommending a 15% rate increase over the next four years - 7% in 2018, followed by 3% in 2019 and 2020 with a 2% increase in 2021.
A current cost of service study is underway.
The 2015 rate recommendations faced opposition to changing a $4.14 minimum monthly bill to a $14.50 monthly customer charge.
The council took several months to review and better understand recommendations included a May 2015 rate study done by its long-time IPL rate consultant.
Indy Energy provided the council with several policy recommendations for consideration during the public hearing.
Other presenting included representatives from the AARP, the Natural Resources Defense Council and the Eastern Jackson County Justice Coalition.
There was broad agreement on opposing increasing the fixed customer charges as creating financial burdens on low-income, fixed income and low-energy users and discouraging energy conservation.
Others spoke in favor of developing energy efficiency programs, increasing utility assistance and support for providing community solar power.
The last major rate change was approved in 2008 when a series of year-to-year rate increases were approved. Read KC Star article about the 2008 rate approval.
Public Power is Suppose to Cost Less
In general, publicly owned power costs less based on national analysis by the American Public Power Association.
The APPA study shows that residential customers of investor-owned utilities paid average rates that were 14% higher than publicly-owned systems.
Currently IP&L residential rates are higher than the investor-owned Kansas City Power & Light.
Data came from 2,006 publicly owned electric utilities, 193 investor-owned utilities and 873 cooperatives from across the nation.