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OTP’s Minnesota customers feel less energy adjustment impact
Published Tuesday, March 4, 2008
Higher energy adjustment payments for Otter Tail Power Company’s customers, following the company’s need to purchase power on the open market during a shutdown of Big Stone Plant for maintenance last fall, are much higher in North Dakota than in Minnesota.
Even though Otter Tail planned the shutdown and arranged to buy power ahead of the shutdown, the company also found that the plant’s generator needed to be repaired. Big Stone Plant is located near Milbank in northeastern South Dakota.
Under North Dakota state law, when a utility’s costs for power goes up, it (the utility) is allowed to pass those costs on to its customers. When Otter Tail did this after the Big Stone shutdown, it caused a dramatic increase in energy adjustment in North Dakota in January and February.
Those customers in North Dakota can call Otter Tail Power Company to arrange a payment schedule or to sign up for Even Monthly Payment.
“The energy adjustment is calculated differently in Minnesota,” Otter Tail spokesperson Cris Kling said, “In Minnesota we can spread the costs over a longer period of time than in North Dakota.”
Janet Gonzalez, energy unit manager for the Minnesota Public Utilities Commission (PUC), said a new base cost of fuel took effect when Otter Tail Power Company implemented interim rates late last year in Minnesota.
“The actual adjustment is different in Minnesota versus North Dakota,” Gonzalez said.
One Fergus Falls customer of Otter Tail Power Company, on a dual fuel rate and who heats his home primarily with electricity, saw the resource adjustment go from $6.80 in the Jan. 9 billing to close to $20 when the next billing came out on Feb. 7. Another residential customer saw his resource adjustment go from $5.26 to $17.83.
Numbers vary for customers, depending on monthly kilowatt-hour usage and customer classification such as residential, commercial and industrial.
In January, the energy adjustment for Otter Tail’s North Dakota’s customers rose to 1.53 cents per kilowatt-hour, and it rose again to 3.5 cents in February. It’s expected to drop from 3.5 cents this month to 3.0 cents per kwh in April and 2 cents in May.
"Then it should return to more historical averages by June," Kling said, “hopefully with no unforeseen circumstances."
Comments
The Daily Journal is happy to host community conversations about news and life in Fergus Falls and the surrounding area. As hosts, we expect guests will show respect for each other. That means we don't threaten or defame each other, and we keep conversations free of personal attacks. Witty is great. Abusive is not. If you think a post violates these standards, don't escalate the situation. Instead, flag the comment to alert us. We'll take action if necessary. It's not hard. This should be a place where people want to read and contribute -- a place for spirited exchanges of opinion. So those who persist with racist, defamatory or abusive postings risk losing the privilege to post at all.Posted by Golden (anonymous) on March 4, 2008 at 3:42 p.m. (Suggest removal)
I would love to have $5-17 resource adjustments! I had a resource adjustment of $70 this month, not bad for $200 worth of electricity...35% bill tacked on? Last year was no better...$40+ resource adjustments all winter.
Excuses, excuses. Too bad I can't switch electric companies. It's a shame and it shouldn't be legal.
Posted by orbit (anonymous) on March 5, 2008 at 1:13 a.m. (Suggest removal)
yes, mine was 73.00 last month, compared to a -14.00 a couple monthes before, shocking when they don't tell you its coming and you just find it on the bill
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