DWP power, water rate hikes OKd

The Los Angeles Department of Water and Power board approved rate hikes Tuesday for residential and commercial customers that would increase electricity costs about 9% and water charges about 6% by July 2009.

The bimonthly cost for average residential customers would rise about $14.50. Monthly bills for medium-sized businesses would increase about $1,043. The increase in the base rate is the first approved by the DWP board in 15 years.

Neighborhood council leaders and business owners warned the DWP board Tuesday that the increases would hurt customers and make it harder for businesses to compete. But agency officials said the hikes were necessary to upgrade aging electrical and water equipment and to keep up with inflation.

The added costs would come on top of separate power increases approved last year to pay for renewable energy resources and efficiency programs. As a result, DWP customers can expect their power bills to rise about 20% by the middle of 2010. Officials said increases would be limited for low-income customers.

Under the plans, power rates would rise 2.9% on Jan. 1, 2.9% on July 1 and 2.7% on July 1, 2009. Water bills would increase 3.1% on July 1 and 3.1% a year later.

DWP Commissioner Nick Patsaouras argued that the DWP had to reduce its spending if it expected customers to pay more for water and power. “If we are going to gain the trust of the public, we are going to have to tighten our belts too,” he said.

Patsaouras proposed that the utility slash expenses on outside consultant services by 15% and other internal costs by 10%. DWP administrators are expected to deliver a plan at the board’s next meeting.

The rate hikes approved must still be considered by the City Council’s Energy and Environment Committee on Oct. 27 and the City Council on Oct. 31.

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duke.helfand@latimes.com