The Milford City Council approved a new three-year electric rate design at its May 8 City Council meeting. The new, lower City of Milford electric rates go into effect June 1. “Our costs for electricity from our wholesale power provider [DEMEC] have gone down this year, so we are able to pass along those savings to our customers,” stated City Manager Eric Norenberg. For upcoming summer and winter rates, the average reduction is 3% (see table for breakdown by customer class).
“We are thrilled to lower electric rates and help customers make more of their budgets,” stated Mayor Bryan Shupe. “As part of our commitment to economic development, it is also important that rates will drop for small and large businesses, as well.”
Customers may also notice a change in their “Monthly Facilities Charge”. The “Monthly Facilities Charge” (sometimes referred to as the “Monthly Fee” or “Customer Charge”) is a fixed monthly charge that is intended to cover the cost of supplying power to our customers. Such costs include the personnel, equipment, parts, etc. needed to do regular maintenance on the electric distribution system and the periodic upgrades/repairs that ensure the reliability customers have come to know. In addition, this charge provides the City with an adequate reserve fund to pay for system improvements or emergencies.
A recent study found that the revenue from the “Monthly Facilities Charge” was not covering these fixed costs. In the past, some of the revenue needed for operations was collected through the electric rate. Going forward, the “Monthly Facilities Charge” will grow to cover the fixed costs and the electric rate will reflect reduced electric costs.
Customer Class Change
Residential Service (RES) -4.12%
Small General Service (SGS) -4.12%
Security Lighting -4.89%
Medium General Service (MGS) -1.19%
Large General Service (LGS) -4.41%
General Service Primary Voltage (GSP) -4.36%
Special Contract Service (SCS) -1.19%
City Accounts -3.00%
Totals -3.00%
“To ease the impact of this change, the “Monthly Facilities Charge” will increase over three years, rather than all at once,” explained City Manager Norenberg. For residential customers, the “Monthly Facilities Charge” will increase from the current $4 to $8 on June 1, 2017. Even with this change, most residential customers will still enjoy lower electric bills this year. In fact, “most residential customers will be paying less three years from now than they did this past year,” noted Norenberg. Source: Utility Financial Solutions (A typical residential customer in Milford uses 960 kph per month.)
The City of Milford is one of nine Public Power communities in Delaware that make up the Delaware Municipal Electric Corporation (DEMEC). DEMEC represents and serves nine municipal electric utilities located in the State of Delaware: Milford, Clayton, Dover, Lewes, Middletown, New Castle, Newark, Seaford and Smyrna. The City of Milford’s electric utility team prides itself on serving the local community with reliable power and customer-focused service.
If customers have questions, they can contact the City of Milford Customer Service Office at 302-422- 6616.