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The $300 snowstorm: Council approves utility rate increase in Colorado Springs

COLORADO SPRINGS, Colo. (KRDO) -- The Colorado Springs City Council approved Colorado Springs Utilities' rate increase request Tuesday to pay for a huge increase in costs incurred during one winter storm event in late February.

The council unanimously approved a rate increase of $21.99 for the next 14 months, going into effect on March 11.

Credit: Colorado Springs Utilities

The average cost per Colorado Springs resident works out to about $308 over the 14 months. It's an even bigger increase for commercial and industrial customers.

This comes after we reported that CSU was looking into how it would pay for a big shift in natural gas costs in late February. When the winter storm hit, many natural gas lines froze and limited supply, driving up wholesale costs. The utility company says that because it's a nonprofit, it passes the costs onto customers whether they go up or down.

During a normal time period, natural gas would be purchased at about $2.50/Dekatherm, but it spiked up to nearly $200/Dekatherm, according to CSU.

The council ruled out Option 1, which would have required customers to pay more over a shorter time period, and initially discussed Option 3, in which customers would have paid less over a longer time period.

"I just read an article this week about home prices again reaching record highs," said Councilman Don Knight. "If we are serious about helping people get into homes, this is one area where we can really make a difference and have some discretional spending, as far as how soon we're going to spread it out."

"This is not what the people in my district need, with the pandemic and people unemployed or working less," said Councilwoman Yolanda Avila. "They're struggling as it is, and this rate increase will only make things worse for them."

However, Option 3 failed by a 5-4 vote and the council ultimately passed the remaining option unanimously.

"What Utilities has presented today, as far as presenting Option 2, is probably the best balance for our community and for our Utilities really managing this fiscally and responsibly," said Councilwoman Jill Gaebler.

The council also debated whether a similar situation could happen again in the future, with some members saying that CSU should be prepared for the possibility and others believing the situation was only a rare event.

In two weeks, the council and CSU will gather again to decide on an increase in electric rates also tied to the February cold spell.

"But that one won't be as much as the natural gas rates," said Utilities' CEO Aram Benyamin. "For residential customers, it'll probably be less than $10 a month."

On the same day the rate hike was approved, Colorado Attorney General Phil Weiser issued a news release urging federal energy regulators to protect Coloradans from the costs due to those spikes. Weiser said he has concerns about reports that an investment bank "benefited from a $210 million 'windfall' from the gas and electricity price swing."

CSU said that it will suspend disconnects until further notice and offered resources for customers who need assistance.

This is a developing story, check back for updates.

Andrew McMillan

Andrew is the Digital Content Director for KRDO.com. Learn more about Andrew here.

Comments

22 Comments

  1. More people will be heading for the food pantries due to this increase.

    ColoFornia Springs City Coucil also recently voted to increase the Storm Water ‘Tax” this after they already swindled us with a illegal storm water tax back a while ago. Many did not pay it and were never forced to while those of us who did never got a refund, outright thivery.

    Never trust government at any level they represent lobbyist’s, corporations, anyone who can buy them while “We the people” are endlessly screwed over.

    1. Honestly, if an expense of $22/month sends someone to the food pantry there are much deeper issues occurring and I hope they are able to get the help that they need

      1. And food stamps and social security were meant to temporarily. It’s this kind of thinking that leads to $1.9 trillion boondoggles! Why don’t go ahead pay for everyone else’s $22 – since it’s only $22.

      2. It is the culmination of all the increases people have been burdening and continue to that is hurting people. This utility increase just adds more weight to the pile of cost increases people are breaking under in ColoFornia Springs.

        Try to see the big picture “ColoFornia Guy”.

  2. And they’re only getting started…better put on those suspenders and pull up them bootstraps. Always the hard-working, mostly law-abiding citizens who pay WAY more than their fair share to support the illegals, bureaucratic elites and degenerates. Thanks, city council, for sticking-it to us!!!

    1. These aren’t those times anymore.
      I have had to keep reminding myself of that- that the cost of everything is going up with no mercy, nobody is handing out compensation pay for when 3 expenses go up noticeably in one month -nobody handing you more cash just to maintain.
      I live on a strictly fixed income situation.
      I understand these implications -they are in my face.

  3. Only the tip of the iceberg! When they replace the coal fired Nixon and Drake power plants with renewable “green” sources, natural gas, and quick-reaction gas plants to offset slumps from lack of sunlight (snow-covered solar panels don’t make much power, even in the day) or too much/too little wind you’ll not only see your natural gas bills rise, but spikes in your electrical rates as well.

    Hope folks have a good emergency fund for future winter/stormy weather!

  4. Does anyone else see the irony of our city council members voting to raise rates for our city-owned utility company, as they sit in their comfy chairs as utility board rate “regulators?” In both positions they put taxpayers and utility users LAST! COVID has given politicians and bureaucrats unlimited power. Why not $100 more a month for more solar panels and frozen wind turbines? If these “representatives” cared at all, maybe they could use a little of their federal money COVID windfall to offset a one-time natural disaster. But no, that would take a little compassion. They just want more, more, more!

    1. Huh, interesting that it was natural gas prices that went absolutely crazy during that storm that’s causing the natural gas prices to rise… Wouldn’t it make sense to use less natural gas to avoid natural gas prices rising?

  5. This is just the beginning of the currency reset. The global bankers are failing our dollar. Politicians are picking and choosing where and how to mitigate the collapse. Deflating the dollar. Look at your property value, it didn’t just go up dollar value went down. Everything else is distracting us from seeing the bigger picture.

  6. The rate increase is merely a test run to see how much push back they receive from the residents. They need to test the waters for when the new green deal moves forward.

    1. If Drake was a brewery; they would wrap the stacks like candy canes during holidays; and it would be modern art, and such a mod complement to the space circle in ATB park.
      OMG, coal!
      Somehow, blame the gas increases on coal.
      OMG. Coal! OMG. The building is even so ugly.
      OMG the first big cold spell when Drake is gone. Wait for it.
      “Utility bill increase of $52.11 a month to save money by shutting down Drake early” fee was announced…”

    2. You can try to push back. All they will do is pull your meter and walk away.

      1. No we push back by voting city council members out of office. They make up the majority of the utility board. It used to be that Colorado Springs Utilities was the cheapest in the state, because it was run efficiently. Now its one of the highest.

        1. Actually even with the new increase they are still one of the cheaper utilities in Colorado.

  7. Remember. Winter is not over yet! Wait for this weekends storm and then in a few weeks…… “We need more money for this storm. We are raising you bill AGAIN another $22/month.”

  8. City council, working hard for the corporations and their lobbyist financing.
    “The Federal Energy Regulatory Commission announced it will look into potential fraud and market manipulation of natural gas prices during the February cold-snap.
    Natural gas prices reached record-breaking levels during a four-day period last month. Market prices of about $2.50/Dekatherm skyrocketed to nearly $200/Dekatherm.”
    quoted from article https://krdo.com/news/2021/03/09/skyrocketing-gas-prices-during-february-cold-snap-leads-to-federal-investigation/
    If it looks like price gouging, and it smells like price gouging, it must be…
    Colorado Springs city council’s response, well before the conclusion of this investigation to verify if this potential fraud and market manipulation occurred during these 4 days in February or not, we will still tell our constituents they will have to pay for it.
    Seem to be on the up and up, more normalcy brought to you by Colorado Springs politicians.

  9. You people are insurrectionist!!! You want comfort at an affordable price? Well the Green New Deal will do that AND MORE!
    You will like it or else….you Vegan Environmentalist want all natural everything? Ok, you will make due when freezing temps do you in! Remember it is good for Mother Earth.

    80 million voters wanted this right?!! Do not question those who decide for you.

  10. There should be no increase in price. If the manager was doing their job properly they would have secured all the natural gas they needed to ride out this cold spell. They don’t buy on an as needed basis. Anyone that pays attention to the weather,which is what the manager of CSU is paid to do, would have know this cold snap was coming well over a month before it hit. It was widely published that an extreme cold snap was coming so why didn’t CSU plan ahead? This increase could have easily been prevented if CSU had done their job instead of buying natural gas on the open market. How can the council justify going along with an increase of almost 60% for a 14 month period due to a 4 day cold spell? Any utility company that is properly managed knows they have to plan for 100 year and 250 year storm occurrences yet CSU seems to only plan for at most 25 year occurances. A full investigation should have been done into the total incompetence of the management team of CSU as to why there was no preplaning for this cold snap. On top of this increase there will be more to come. Next month if not sooner the electric rates and water rates will increase they just didn’t want to deal with the public backlash if they increased all the rates at once. Ask yourself why they didn’t increase them all at once when they do increase. Before all is said and done the increase will amount to around $50 dollars a month due to a 4 day cold snap all because of an incompetent management team at CSU.

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