by James Jordan, Sumner Newscow — Wellington City Council members heard in great detail how electric rates are set at the state and regional level, as well as the mechanics of the power charge adjustment, during a presentation at the council chambers Monday. Larry Holloway, assistant general manager of operations, spent nearly two hours going over the intricacies of how rates are set.

Mayor Shelley Hansel called the presentation informative, and other council members also said he helped them understand how rates are set.

The city had invited them down to explain rates recently. There was little discussion, only a few questions, and they are not planning to take any action as a result.

The council spent more than a year talking about raising its rates, and did pass a substantial rate increase this year. That increase – on the amount used – will take effect the first of the year. The power charge is set by the Kansas Power Pool and that is passed through by the city.

That charge has been lower in recent months mostly because of the cost of things like coal and natural gas, and if it stays that way it could offset some of the increase in rates.

To get the energy cost adjustment, KPP officials go through a complicated process of forecasting usage and costs. They put together an annual budget based on these numbers, but that number changes each month based on actual sales and usage. Holloway said there is a service they use that can predict usage down to the hour.

He said a lot of the costs involved are fixed costs and do not change, but usage does change a lot, and that is where projections come in.

It could be the estimates could be high and it would not cost as much as they anticipated. When that happens the city gets a credit back to its account and that is passed on as savings to the customer in future bills. Some controversy was created last year when that was called a refund.

Holloway also explained that during months of lower usage, like April and October, the rate customers are charged is actually lower but the charge per unit may be higher. The opposite is the cases in high usage months during the summer.

Wellington was one of the first members of the Kansas Power Pool, and is in its second year of a 20-year contract.

Not all cities are members, and there has been discussion of selling power to those cities and allowing for a shorter term agreement.

Holloway was also asked if there was a danger to the national electrical grid if there were a terrorist attack. He said the systems across the United States are connected and flexible. Even if a certain area of the country were shut down, the system could work around that and still provide power.

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In another matter, City Manager Roy Eckert said the street survey is done, and they would like to give a presentation to the council next week. Thursday, Dec.3 is being considered. This report will give detailed analysis of many of the streets in the city.

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