EDGERTON — Every community in Williams County is looking at their electric rates as COVID-19-related shutdowns mean big-ticket purchasers aren’t using the same amount of electricity as planned.
In Edgerton, it has already led to a $183,000 deficit, said Zachary Dohner, village administrator, during a special council meeting Monday evening.
Edgerton is part of American Municipal Power, a nonprofit wholesale power supplier and services provider for 135 members in nine states.
“We have to commit to a consumption of power annually and that’s based off our history,” Mayor Bob Day said. “With this year being the unique situation it’s been, we haven’t used as much power at this point as we have in the past. But, being a part of a conglomerate, the expenses are fixed. They don’t fluctuate.”
What does fluctuate is how much energy the village uses versus how much they committed to purchase, he said.
This number is far lower this year because big energy users — in Edgerton, those include Matsu Ohio Inc., Edgerton Forge and the school system — all reduced their power load.
Dohner wanted to clarify that utility rates won’t change, but what will change is the power supply cost adjustment, typically called an “adder.”
That is figured out by finding the used power versus the projected power.
Jason Gruver, council president, said in April they used 68% of what was forecasted, compared to earlier in the year, when they used more than 90%.
Dohner said that adder is projected to go up around 3-3.5 cents per kilowatt-hour. For most people, that would result in around $20-$30 more on their monthly bill.
The problem is that this is coming around the time people are starting to increase energy usage as temperatures get higher and people use their air conditioning more.
Day, for example, saw his kilowatt-hour usage increase by 600 between his last month’s bill and this month’s. That increased his bill by nearly $80 with the addition of the adder. Without that increase in usage, his bill would have only increased by around $15.
Dohner suggested three actions for the council, one of which they intend to take at their meeting next week.
The first option he had was to do nothing and just bill village residents normally. This would result in a peak in three or four months that would then even out around Thanksgiving.
The second option, and the option that Dohner is recommending, is to set a cap on the adder.
“We set a cap on what this month’s is going to be, which is still higher than normal, but will be about a cent-and-a-half lower for about two months and it’s going to be about half a cent lower than what would be forecasted out,” he said.
The village would essentially under-collect for a few months, Dohner said. As things level out, they will then over-collect until they make up that lost revenue. This would lessen the burden on the customers.
Once that lost revenue is recovered, that cap would be removed and just go back to the regular payment scheme.
The final option is for the village to eat the cost. Dohner didn’t have a projection on how much that would be.
Denise Knecht, village fiscal officer, said the electric fund has just over $2 million in cash on hand.
Councilman Tom Karnes said part of the problem is they don’t have a battery to store the power that’s not being used.
“Then, you would be able to use that power (later),” he said. “The hydroplants, the windmills, they generate power, ‘Here’s the power, you asked for it and here’s how much you get it.’ If you over-use it, it’s the same thing. They’re not storing power in batteries somewhere. They’re making it whether we use it or don’t use it.”
Day suggested they go at it a month at a time.
“There’s a lot of unknowns,” he said. “I think it’s important that the residents know we’re going to cap it and we’re also going to look at what we’re going to do next month.”