Council hears small-business complaint as utility consultant proposes multi-year electric rate increases

Melissa Norgard, co-owner of Boss City Brewing, told the Sydney City Council on Aug. 4 that her business at 1200 Jackson Street was reclassified from small three-phase power to large-demand service after exceeding a 50-kilowatt threshold by about 0.8 kilowatts during a roughly 10‑day period. She said the city mailed a notice but provided no advance warning or opportunity to correct the spike; the reclassification will keep the brewery on the large-demand rate for the remainder of the current fiscal year and the next fiscal year, she said, and she estimated the change could nearly double her monthly power bill. Consultant John Kraske, who presented the city’s electric rate study the same evening, told the council the goal of the study is to align rates with the cost of service and to preserve the utility’s financial stability. Kraske recommended a rate plan including two 8% increases (one April 1 and one Oct. 1, 2026) followed by two 4% increases in subsequent years, and he said the study anticipates a longer-term need of about 29% by 2030 under some scenarios. Kraske also said the utility’s customer charge — the fixed monthly amount that recovers the cost of providing service even if a customer uses no energy — is roughly $27 on a cost-of-service basis and should move closer to that level over time. Kraske and council members discussed language in the draft ordinance (designated as ordinance 18‑76) that governs how customers are moved between service classes after a demand spike. Council members and staff raised concerns that the ordinance’s current wording is confusing about how long a business remains on a higher-demand class and whether the period should be one year, two years or tied to billing cycles. A city staff member said the city had learned that the utility wholesaler (MEAN) may apply a three-year demand determination in some cases; staff and the consultant agreed to review the ordinance language and return with clearer wording. The council designated ordinance 18‑76 for further consideration and did not waive three readings that night; no final adoption vote was taken. The study presentation covered several items council members raised: the city’s recent capital spending (including a new power plant), an upcoming substation project, the city’s strong cash reserves, and uncertainty in wholesale costs from the Municipal Energy Agency of Nebraska (MEAN) and the Southwest Power Pool market. Kraske said the proposed multi-year ordinance gives the council the option later to pause or rescind planned increases if financial conditions improve. Discussion versus action: Melissa Norgard’s remarks were entered during public comment. Kraske’s presentation and council questions constituted discussion; the council voted to designate the ordinance for further consideration (first-step action) but took no final adoption vote that evening. Staff and the consultant were directed to rework the demand-class wording and return it for the ordinance process. The matter affects commercial customers with high short-term peaks, and the council flagged a need to improve notice to small businesses when they approach demand thresholds so customers can avoid unintended reclassification.