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Board reviews proposed rate changes: higher service charge, time‑of‑use pricing and wastewater increase planned
Summary
DPU staff presented three proposed ordinances that would raise the electric residential service charge in two steps, add time‑of‑use and a small demand charge for residential customers, and increase wastewater rates; staff and board members debated timing and weekend on‑peak definitions ahead of ordinance introduction on March 19.
Los Alamos County Department of Public Utilities staff presented a set of proposed rate changes to the Board of Public Utilities on March 5, including a phased increase to the residential electric service charge, a new time‑of‑use rate with a small residential demand charge, and an increase in wastewater rates.
Karen Kendall, presenting staff recommendations, said the proposals are part of three ordinances the board will see for introduction March 19 with public hearings planned in April and May; if council proceeds on its schedule, the ordinances would take effect July 1, 2025 (initial adjustments) and later dates into FY‑27 depending on the measure. Kendall summarized the three linked proposals as: a phased rise in the monthly service charge from the current $12.60 to $17.60 on July 1, 2025 and to $22.50 in FY‑27; a time‑of‑use (TOU) structure with an on‑peak period the utility staff recommends between 5 p.m. and 11 p.m., an off‑peak energy price and a proposed $1 per kilowatt residential demand charge; and an increase in wastewater rates (staff recommended 7% rather than a previously planned 2% step).
Kendall said the FY‑26 budget includes a roughly 6.5% blended increase across utilities; individual proposals in the ordinances would be 9% for electric and 7% for wastewater (the water and gas increases of 5.56% had been adopted earlier and take effect October 1, 2025). She said the proposed service‑charge increases reflect the department’s administrative allocation and interdepartmental charges and that the national median for service charges is substantially higher than Los Alamos’ current $12.60.
On TOU and demand charges, Kendall and board members discussed the timing window, weekend treatment, and implementation schedule. Kendall recommended keeping TOU simple to ease customer understanding and to limit billing complexity; staff proposed a one‑year minimum implementation lead time to update billing software and customer education, and requested board direction on whether weekends should be treated as off‑peak. Members debated whether to adopt weekend off‑peak pricing (several neighboring utilities use weekend off‑peak) and asked staff to re‑run comparisons if the board favored that approach.
Board members discussed demand charges as a means of signaling and limiting peak instantaneous load as the county and customers move toward electrification. Philo Shelton, DPU director, said the proposed demand charge was reduced in response to prior board feedback and that staff’s intent is to phase the service‑charge adjustments while keeping the demand number modest so that customers have an incentive to smooth peaks. Board members urged staff to publish clear education materials and charts showing how a typical 500 kWh household bill would change under the two‑step service charge and the TOU/demand design.
Staff also noted an implementation detail: roughly 40 customers currently opt out of electronic smart‑meter communication and would be billed on the on‑peak rate for every hour if they remain manually read; staff said they will reach out to those customers during implementation. The board discussed aligning the TOU effective date with the county’s expected solar + battery resource coming online but agreed staff needs implementation lead time for billing and customer outreach. No vote on the ordinances occurred at the March 5 meeting; staff will bring ordinances for introduction March 19 and hearings are scheduled for April and May.
