Council Tentatively OKs Hikes in Electricity, Water Rates

The Los Angeles City Council on Wednesday gave tentative approval to electricity and water rate increases reflecting higher operating costs and such factors as drought-related shortages and new water quality standards.

The overall 9.6% average hike in the cost of water and 4.4% average rise in power costs would result in a total jump in average bimonthly residential bills of about $6, according to DWP estimates. That average figure is based on monthly consumption of 400 kilowatt hours and 1,800 cubic feet of water.

On the same 11-2 vote, the council tentatively approved increases equivalent to about 70 cents a month in so-called lifeline rates for elderly DWP customers.

The proposed rate increases are expected to receive final approval next week and could take effect by Oct. 1.

DWP officials said that by conserving roughly the same percentage of water and electricity as the rate increases, utility customers can avoid additional costs.

The electricity hike, expected to raise about $67 million annually, is the first since 1985 and is needed to offset projected increases in operating and construction costs as well as the cost of maintaining a good credit rating, DWP officials said. For the utility’s 1.3 million electricity customers, the average bimonthly electric bill will climb from $65 to $67.84.

Lifeline customers using 300 kilowatt hours or less per month of electricity will see a hike in their bills from about $26.86 to $27.86, or about $1 every two months. There are about 100,000 electricity customers at least 62 years old with annual household incomes of less than $14,000 who qualify for the lower rates, the DWP said. Some younger customers who are disabled also are eligible for lifeline rates.

DWP officials said the water rate hike would raise about $24 million more a year for the utility’s water system and is necessary to meet ongoing fixed costs as well as projected costs to meet new state and federal water quality standards. DWP Assistant General Manager Duane Georgeson said that handling of hazardous wastes as well as water conservation efforts would consume a large part of the increase.

For about 590,000 regular water customers, the rate hikes would increase the average bimonthly bills by about $3.34, from $34.98 to $38.32

The DWP’s 40,000 water customers who qualify for lifeline rates will see a rise in their bimonthly bills of about 34 cents. (There are about 60,000 fewer water lifeline customers than electricity lifeline customers because a greater number of the former are on master meters for water usage, the DWP explained.)

Councilmen Nate Holden and Gilbert Lindsay objected to the lifeline hikes and won assurances that the Board of Water and Power would be informed that the council objects to such increases because they tend to hurt senior citizens on fixed incomes the most.

The base-rate portion of the average bills will increase 12% for water and 8.13% for electricity. The base rate is a fixed amount normally charged for water and power that does not take into account fluctuating added costs due to shortages.

For example, customers now pay about 21 cents more per 100 cubic feet of water than normal because the drought has forced the DWP to buy about 15% of its water from the Metropolitan Water District, said Mary Indermill, DWP rate manager. That 21 cents is not included in the base rate and is not affected by Wednesday’s council action, she added.