The price of necessities only goes in one direction—up—but don’t tell Electrical District No. 3 (ED3). The Maricopa, Arizona, public utility is lowering its 2018 electric rates an average of 2 percent for residential, commercial, small industrial, large industrial and agriculture customers.
At a time when other utilities and businesses across the nation are raising their rates, the ED3 board of directors approved a rate decrease for the third year in a row. CEO and General Manager William Stacy attributes this exciting accomplishment to sound management and a diligent planning process.
Partnership cuts costs
Specifically, Stacy noted the benefits of being part of the Southwest Public Power Agency (SPPA). In 2014, ED3 formed the joint action agency with 17 other Arizona public power and tribal utilities. Members enjoy economies of scale in terms of managing existing resources and developing new ones, Stacy explained. “We see a lot of benefits for our customers, particularly those in Arizona’s rural or tribal areas,” he added.
A new power pooling agreement with SPPA for electricity from the Hoover Dam has allowed ED3 to reduce costs for balancing services. This year ED3 was able to move its controlling area into the Arizona Electric Power Cooperative’s controlling area for additional savings on operating costs.
Planning for growth
To keep rates down, you also have to keep an eye on the future, especially in a community that is growing as fast as ED3’s service territory. “We are constantly reanalyzing our 10-year load growth plan,” said Stacy.
ED3 is the largest electrical district in the state, currently serving about 25,000 residential, commercial and irrigation meter connections. The district operates 12 distribution-level substations, and is building a new one to accommodate the average of 65 new homes springing up in the area each month. “In terms of rates, being large helps because we are able to spread fixed costs over a wide customer base,” Stacy acknowledged.
Wise use still important
Even with standard residential rates that are 10 percent lower than investor-owned Arizona Public Service, ED3 does not take customer satisfaction for granted. Programs to help customers manage their own energy use are very much a part of the district’s business model.
ED3 offers customers a Home Performance with Energy Star® Home Energy Audit for the heavily discounted price of $49. Homeowners can choose from a list participating contractors posted online. Customers can also attend free quarterly conservation workshops ED3 presents, and find energy conservation tips in the district’s bimonthly newsletter.
Rate, payment flexibility
In addition to having the lowest rates in the area, ED3 residential customers also have the choice of two time-of-use (TOU) rate schedules. The peak time for TOU-A is 9 a.m.-9 p.m. and 12-7 p.m. for TOU-B. The applications provide energy-saving tips so that customers can maximize the benefits of the schedule. “They can choose whichever one works best for them,” said Stacy.
ED3 also implemented a pre-paid metering program last year. Customers pre-pay for their electricity and receive daily text or email notifications of the amount they use and the amount remaining on their account. Studies have shown that customers who use a pre-pay option tend to use less electricity. Whether it is the energy savings or the feeling of control it gives customers, the program has proved surprisingly popular, Stacy observed. “We have 1,470 customers participating in it,” he said.
Which brings up another truism: People are always looking for ways to pay less for necessities. Luckily for ED3 customers, their utility is always looking for ways to help them.
Source: Public Power Daily, 11/6/17