| | | | | | | | | City of Independence | | AGENDA ITEM COVER SHEET |
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| | | | | | | | Agenda Title:
Council action is requested to recover the excessive costs for fuel and energy from Winter Storm 2021, the City Manager is directed to use the Fuel Cost Adjustment formula over a period of 36 months. |
| | | | | | | | Recommendations:
Recommended by the Public Utility Advisory Board on July 1, 2021 to forward to City Council for Approval. Recognizing the continuing economic impact of the State of Emergency and the resulting budgetary strain on many Independence families and businesses, the City Manager is directed to recover the excessive costs from the Winter Storm of February 2021 gradually, using the Fuel Cost Adjustment formula to spread those costs over a period of 36 months. |
| | | | | | | | Executive Summary:
High costs for fuel and energy driven by the effects of the Winter Storm in February 2021 resulted in excessive costs to IPL of more than $8,000,000 above the historical costs of similar winter months. The Fuel Cost Adjustment, Schedule FA-1 of the published IPL Rates, is the designed mechanism for recovering those costs. Typically, monthly costs for fuel and energy are compared to a historical baseline and the formula calculates a charge or credit to be applied to the next month's usage. IPL has the discretion to distribute those costs over a longer period to minimize the impact on ratepayers. |
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Fiscal Impact:
As of May 2021, the electric fund balance is $24,847,179 below the City’s target. Collecting the $8,000,000 in costs will help maintain the financial integrity of the fund.
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| | | | | | | | | Department: IPL | Contact Person: Jim Nail |
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| REVIEWERS: | | Department | Action | | Power and Light Department | Approved | | Finance Department | Approved | | City Managers Office | Approved | | City Clerk Department | Approved |
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| Council Action: | Council Action: |
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