The costly effort to restart Fort Calhoun Nuclear Station is trickling down to customer's electric bills.
The Omaha Public Power District on Tuesday proposed a 6.9 percent general rate increase for 2013, which would be the second-highest rate hike in 10 straight years of increases.
Residential rates would go up by 7.7 percent, which the district said is an average increase of $7.30 per month.
Industrial customers' bills would increase by 8.5 percent, while the proposed commercial rate increase is 5 percent.
In committee meetings with the OPPD board, officials said they've tried to lessen the impact from Fort Calhoun's problems on ratepayers by cutting costs across the district, selling power to customers outside the district and taking money from savings.
But Edward Easterlin, vice president and chief financial officer, said it became clear that without more revenue from ratepayers, there would be noticeable effects on service and maintenance of key facilities, including Fort Calhoun.
The amount of the proposed increase was made final last week.
“We would have to go in and start looking at how we maintain our system,” he said. “We would have to start making decisions that would impact reliability. We would always try to retain employee and customer safety, but it could effect how soon we respond to an outage.”
Fort Calhoun is of particular concern.
The reactor at the plant, located about 20 miles north of Omaha, has been shut down since April 2011 because of safety violations and concerns over Missouri river flooding.
Work to fix those problems and get U.S. Nuclear Regulatory Commission approval to restart the plant will push the district over budget by about $134 million this year. A deal to hand off management duties at the facility to a private company, Exelon, has made up a significant part of that cost, though Easterlin said he couldn't share the actual amount.
The district's proposed 2013 budget calls for Fort Calhoun to reopen in February, but the NRC has not indicated that it's ready to OK a restart. If a restart is delayed, Easterlin said the district will have to spend more money to buy power which could have a significant impact on the budge.
“It's critical we get it back up before the summer,” he said. “Once we get into the summer, the cost of the outage, the replacement (power) becomes much higher.”
The district's handling of Fort Calhoun was a major issue in the recent election, in which three OPPD board seats were up for grabs. And one longtime incumbent is on the brink of being voted out of office.
At last count, Tom Barrett held a 36-vote lead over board member N.P. “Sandy” Dodge Jr. for a Metropolitan Subdivision seat, according to the Douglas County Election Commission. Election officials still are counting provisional ballots, and once that's done, it's likely that the margin would trigger a recount.
Barrett said he talked with many voters who seemed frustrated by the continued closure of Fort Calhoun and worried about higher bills.
“There's a chunk of the voters who felt like OPPD didn't have their best interests in mind,” he said. “There weren't any solid answers with OPPD about when (the Fort Calhoun reactor) was going to start.”
District officials said the rate hikes aren't just about Fort Calhoun.
They said they are also facing significant expenses for capital projects, including some to keep up with new emissions and nuclear power regulations. Plus, the district expects to see a drop in how much money it makes from sales of power to outside customers, because of lower electricity prices.
OPPD's proposed rate increases are higher than several other local utilities, including the Nebraska Public Power District, which last week approved a 3.75 percent rate hike. Lincoln Electric System's proposed increase is 2.6 percent.
But Easterlin said the new rates would come in at 3.5 percent below average in the region and 18.5 percent below average nationwide.
District officials will discuss the proposal at the OPPD board meeting Thursday. The board is to vote on the plan Dec. 13.
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