Fair Utility and Energy Rates
ALERT: The lateset electric rate hike proposal by MN Power, filed in Nov., 2009, has been concluded, with good results for residential and small business users. For almost a year and half, all users have been paying an 11.3% temporary, “interim” rate hike. The final results, which should start in June 2011, are only 4% for residential (and much less than that for the smallest users); 5.4% for small businesses, and 16.1% for the large industrial users (taconite and paper plants). The remaining issue now is whether or not residential and small business customers will get the rate refunds that both the Citizens Federation, and the Attorney General, feel are due.
The cost of essential services, like household utilities, is a huge problem if you are moderate or low income. The Citizens Federation has devoted a lot of energy to tackling this problem, and we have great results to show for our efforts:
- We proposed and won, in 1979, a reduced electric rate for all Minnesota Power residential customers for the first 350 killowatt hours (kwh) per month. We have repeatedly and successfully defended it ever since in numerous rate cases, including in 2009. This saves about $200 a year per household versus what was proposed. For our efforts, we were awarded intervenor compensation four times by the state’s Public Utility Commission, in recognition of the important evidence we provided. The cumulative effect of our efforts is several million dollars a year that is saved, and spent in the local economy, which would otherwise have gone to out-of-area utility investors. Now we’re at work challenging the fairness of yet another electric rate hike request.
- We helped convince the Duluth City Council in 2009 to not pursue the ill-advised idea of selling off the City’s municipal natural gas department. We showed how a privatized utility would raise rates and not save the City money.
- We helped defeat telephone and electric deregulation in Minnesota, and helped defeat national deregulation of natural gas back in 1982.
- We held down garbage rate increases in Duluth, and fostered real competition to break the price-fixing of the local cartel. Everyone’s garbage rates went down 10-15% as a result.
- We helped create competition in the fuel oil and gasoline markets in Duluth, again breaking a local price-fixing cartel, and reducing everyone’s prices about 10 cents per gallon.