2019 was a transformative year for Rochester Public Utilities, particularly on the Electric side. The future of energy in the City of Rochester will be reliable, clean and economical. In order to meet our Rochester climate obligations we must clean up our electric sources and transition away from fossil fuels for heating and transportation. I feel the public is due an update on the good work being done by our Public Utility.
Residential Customer Charges
A frequent criticism of our rate structure is the fixed portion of our rates are regressive and take away from the personal benefits of conservation. As a result we reanalyzed what fixed costs were necessary to support residential customers regardless of usage and reduced our target customer charge from $21.50 to $18.30 per month. Instead of this charge going up in 2020, it is going down.
In 2019 RPU performed an infrastructure planning update looking at different power supply scenarios. As a utility we studied what it would look like to use 25%, 50%, 75%, and 100% renewable energy. One of the interesting findings was that we had to abandon the 25% scenario because it was more expensive to have that little renewable energy in the mix. Ultimately the RPU board gave direction to only pursue 100% renewable energy as the cost was similar to other scenarios and met Rochester environmental goals.
Certain topics are critically important to the future of energy production, these include Demand Management, Energy Storage, Electric Vehicles. These topics are so important to the future success of the community. RPU invested in targeted studies on these issues. The resulting research papers will allow our community to prepare and benefit from these new technologies.
A major update to the RPU Facilities was completed in 2019, this is the first major upgrade of the facility in decades and will allow RPU to continue to provide outstanding service and value to the community.
Based on feedback from the public the RPU Board of Directors initiated the creation of a policy for how RPU will evaluate and plan for how overhead utility lines are eventually buried. About ⅓ of the community is still served by overhead lines. Every year this figure continues to go down. The new policy is expected to be available for public review and implemented in 2020.
Time of Use Pilot
In late 2019, the RPU Electric Utility created a team to create an opportunity for some RPU customers to pilot time of use rates. This technology will allow consumers who choose to use electricity when it is abundant and inexpensive to be rewarded with lower bills. This voluntary pilot program should be available in 2021. This is also the beginning of the road towards smart meters being installed throughout Rochester.
In 2019, RPU installed a new form of billing software from Cayenta. The upgrade was required due to older software approaching the end of its life. The process was frustrating and took longer than expected, but was successfully completed in 2019. The transition caused a few small issues for consumers but will serve the community well into the future.
Investment in Solar
In addition to the massive shift to renewables that RPU will see between now and 2030, we also are making an investment in a local array. The 10 MW array should be under construction in 2020 and will be located to the West of Rochester.
We have an old turbine that we were going to retire because it was inefficient and seldom used. We learned that there was actually a reasonable market for this unit’s capacity (backup availability). As a result we were able to sell that capacity on the open market and actually will earn about $10.9 million dollars for the utility over a 10 year period beginning in 2022. Additionally we get to hold on the the “connection” to the grid for possible future uses, this option has great value and we are actually getting paid to keep this option alive.
2020 Electric Rates
Despite all of the successes above, RPU was able to freeze 2020 electric rates at the same level as 2019. Because inflation is always an issue this means that the real cost of our Public Utility is actually going down in 2020.