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HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 11/07/2017 - ITEMS RELATING TO THE 2018 UTILITY RATESAgenda Item 21 Item # 21 Page 1 AGENDA ITEM SUMMARY November 7, 2017 City Council STAFF Randy Reuscher, Utility Rate Analyst Lisa Rosintoski, Utilities Customer Connections Manager Lance Smith, Utilities Strategic Finance Director Eric Potyondy, Legal Cyril Vidergar, Legal SUBJECT Items Relating to the 2018 Utility Rates. EXECUTIVE SUMMARY A. First Reading of Ordinance No. 155, 2017, Amending Chapter 26 of the Code of the City of Fort Collins to Revise Electric Rates, Fees and Charges and Updating Related Provisions. (Option 1, Option 2, or Option 3) B. First Reading of Ordinance No. 156, 2017, Amending Chapter 26 of the Code of the City of Fort Collins to Revise Water Rates, Fees and Charges and Updating Related Provisions. C. First Reading of Ordinance No. 157, 2017, Amending Chapter 26 of the Code of the City of Fort Collins to Revise Wastewater Rates, Fees and Charges The purpose of this item is to enact rate ordinances related to 2018 proposed utility rates. A 1.8% increase to monthly charges is being proposed for the Electric Fund in 2018. Electric rate increases are proposed to meet increased wholesale costs and to provide some operating income to the utility. Staff will be presenting three separate rate ordinances, all of which incorporate the 2018 increase that would be effective January 1, along with variations for separate residential time-of-use (TOU) rate options to be implemented in October 2018. Staff recommends implementing the standard TOU rate for all residential customers, as opposed to the TOU+tier option. A 5.0% overall rate increase is proposed by staff for the Water Fund in 2018, with variations by rate class. Water rates are proposed to increase to meet the anticipated capital needs of the utility. A 3.0% overall rate increase is proposed for the Wastewater Utility in 2018, with variations by rate class. Wastewater rates are proposed to be increased to address previous operating revenue shortfalls in order to meet anticipated capital expenditures for the utility. STAFF RECOMMENDATION Staff recommends 2018 rate adjustments as follows: • A 1.8% rate increase for the Electric Fund in 2018, along with implementation of a default TOU rate (Option 1 above) for all residential customers in October 2018 • A 5.0% rate increase for the Water Fund in 2018, with variations by rate class • A 3.0% rate increase for the Wastewater Fund in 2018, with variations by rate class Staff recommends adoption of these Ordinance on First Reading. Agenda Item 21 Item # 21 Page 2 BACKGROUND / DISCUSSION 2018 Electric Rates – Ordinance No. 155, 2017 (Option 1, Option 2 or Option 3) A 1.8% overall rate increase is proposed by staff for the Electric Fund in 2018, which is consistent with the City Manager’s Recommended Budget (CMRB) for 2018. This rate increase is driven mainly by an increase in wholesale purchase power costs, which requires a 1.4% retail increase, along with an additional 0.4% increase for the distribution system expenses, which will increase operating income by ~$500k / year for future capital investments. Platte River Power Authority is expected to increase Tariff 1 purchases by 2.0%, which equates to a 1.4% increase at the retail level. Both the summer and non-summer seasons, and the energy and demand components, will increase equally. Below is a table of the current 2017 component charges, along with the proposed 2018 component charges. 2017 Proposed 2018 % Change Energy Summer 0.04200 / kWh 0.04284 / kWh 2.0% Non-summer 0.04028 / kWh 0.04109 / kWh 2.0% Demand Summer 11.33 / kW 11.56 / kW 2.0% Non-summer 8.64 / kW 8.81 / kW 2.0% Tariff 7 charges from PRPA for renewable energy are not proposed to change in 2018. Time-of-Use Implementation Staff’s recommendation is to implement a standard TOU rate for all residential customers in October 2018. Discussions around this recommendation took place at Council work sessions in February and again in July. Some Councilmembers expressed interest for bringing back TOU+tier options. Staff presented the TOU pilot study results to the Energy Board in March and October, where the Board voted 6-1 in support for residential TOU rates, as recommended by staff. Consistent with Council’s work session discussions, there are three options for Ordinance No. 155, 2017, presented for City Council to consider. Option 1, which is a standard TOU rate for all residential customers, is the option recommended by staff. Option 2 is implementing the TOU + tier rate structure for all residential customers. Option 3 is a combination of the first two options. This option would default all residential customers to the TOU+tier option, with the exception of electric heat customers, who would be on the standard TOU rate. Agenda Item 21 Item # 21 Page 3 The table below shows a side-by-side comparison of the two TOU rates included in the pilot study. The cells highlighted in green identify where staff has identified a stronger justification for implementing that particular rate structure. This is the basis for staff recommending the TOU rate for all residential customers, rather than the TOU+tier option. For more detailed understanding of the rate options, comparisons, and recommendations, please see the July 7 Council Work Session AIS. (Attachment 2) TOU Customer Outreach The memo provided to Council in May and discussion at the July work session outlined proposed timelines and the TOU Rates Communication Plan, recommending an October 1, 2018 effective date, based on following needs: • Develop messaging, look and feel of campaign that resonates with customers • Design outreach and education materials that are easy and simple to understand • Consult community boards and groups prior to City Council action • Provide thorough customer engagement prior to effective date of October 1, 2018 • Ongoing outreach and communications engagement after effective date • During the pilot study, customers were sent postcards with graphics similar to what is shown below to help educate them around seasonal changes in on-peak hours and costs that included the specific rates. Based on the TOU pilot study feedback, staff would provide similar outreach upon full rollout. Examples may include postcards, letters, utility bill inserts, refrigerator magnets, etc. As it is not recommended that a new rate structure be deployed during the summer peak season, the optimal deployment was determined to be October 1, 2018. This option allows for time and resources to create and execute communication materials and outreach plans and for public communication, as well as targeted communication to reach customer segments within the broader residential customer class based on behavior types. In addition, key stakeholder groups have been identified to make formal presentations as part of their Agenda Item 21 Item # 21 Page 4 regularly scheduled meetings. Strategies for mass communication, targeted communication and stakeholder collaboration have also been developed. By implementing TOU on October 1, 2018, a lead time of 11 months will maximize outreach. 2018 Water Rates – Ordinance No. 156, 2017 There is a 5.0% overall rate increase proposed by staff for the Water Fund in 2018, which is consistent with the City Manager’s Recommended Budget (CMRB) for 2018. This rate increase is driven by the need to increase available reserves for near-term capital requirements and to increase operating revenues to cover debt service that will be needed to achieve the 10-year prioritized capital improvement plan (CIP). It is expected that capital improvement spending over the coming decade will be at a rate that is twice what it has been over the past decade. It is also front heavy in capital needs. The Strategic Financial Plan (SFP) outlines a path forward which will require leveling the capital investment over the coming 10 years to the extent possible that allows for modest rate adjustments and debt issuances. Approximately $200M worth of capital work is expected prior to 2026, which includes anticipated work associated with the Halligan Water Supply Project. Along with the overall planned increase, the cost of service study for the Water fund was recently updated from the last update two years. The graph below shows the results of the study. The residential classes will need a slightly less than the average increase, as compared to the fund increase of 5.0%, while the commercial class will need slightly more than the average. These changes take into consideration slight shifts in use from the last model update, along with reduced peak demands for residential customers and slight increases in peak demands for commercial customers, as well as the most current allocations of capital spending needs, which impact rate classes differently. 2018 Wastewater Rates – Ordinance No. 157, 2017 There is a 3.0% overall rate increase proposed for the Wastewater Utility in 2018, which is consistent with the CMRB for 2018. Operating revenues for the Wastewater Utility continue to be below budget. The 3% increases in both 2017 and 2018 in the Recommended Budget are expected to address this continued revenue shortfall and put this fund on a path to provide sufficient available reserves to complete the 10-year CIP without the need to issue new debt. It is expected that ~$80M of capital work will be needed prior to the year 2026. Agenda Item 21 Item # 21 Page 5 The main driver for the increase is related to the ongoing revenue shortfall. This revenue shortfall impacts the Enterprise Fund’s ability to financially support the 10-year CIP. The modest rate adjustments in recent years, along with the planned increase in 2018, are expected to address this continued revenue shortfall and put this fund on a path to provide sufficient available reserves to complete the 10-year CIP without the need to issue new debt. This Fund is also projected to have sufficient available reserves to implement anticipated regulatory nutrient removal requirements just beyond the 10-year horizon without needing to issue addition debt. Along with the overall planned increase, the cost of service model for the Wastewater fund was updated recently from the last update two years ago. The proposed increases by class are summarized in the graph below. A driver for the adjustments is an increase in use from the commercial class, as well as a larger increase in the number of accounts for the multifamily and commercial classes. Currently, when a customer does not have an established winter quarter average (WQA), the class average has been used for billing purposes until enough history has been established. For the single- family class, 4,800 gallons has been the default, but with demands going down, staff is proposing to reduce this to 4,000 gallons. For duplexes, the default amount would reduce from 7,200 to 6,200 gallons based on the lower average demands for the class. Multi-family would reduce from 3,400 to 3,200 gallons per unit. The graph below shows average WQA trends by year over the past decade for each residential class. Agenda Item 21 Item # 21 Page 6 2018 Stormwater Rates No rate increase is being proposed for the Stormwater Fund in 2018. There was a 5.0% increase in 2017, which was incorporated to allow for the initial build out of the stormwater infrastructure on a 15-year completion schedule beginning in 2017. It is expected the utility will need ~$156M of capital work prior to the year 2031. The increase in 2017 was the first increase for this fund since 2004. CITY FINANCIAL IMPACTS Typical Residential Utility Bill The typical residential customer’s total utility bill will increase in 2018, under the proposed rate changes, by 2.2% on average in the customer’s 2018 monthly bills. The table below shows the impacts of all of the proposed rate changes on the utility bill of a typical residential customer. Current Estimated $ % 2017 2018 Increase Increase Electric 700 kWh/mo Stormwater 8,600 sq.ft. lot, light runoff Wastewater 4,000 gal/mo $33.22 $33.72 WQA Water 5 kGAL non-summer, 15 kGAL summer Total Estimated Average Monthly Utility Bill $164.73 $168.43 $3.70 2.2% $14.69 $14.69 $0.00 0.0% $0.50 1.5% $45.75 $47.67 $1.92 4.2% $71.07 $72.35 $1.28 1.8% Communities along the Front Range were recently polled on their expected 2018 rate increases. As shown in the table below, it is apparent there are varying challenges within each community that drive differing increases each year. In some cases, increases are greater than 10% for services such as water and wastewater. Electric increases range from no increase up to 5.0% for 2018. Electric Water WW Storm 2018 2018 2018 2018 Lower Range Increase 0.0% 3.5% 0.0% 0.0% Upper Range Increase 5.0% 13.0% 11.0% 7.8% 2018 Estimated Rate Increases Greeley / Loveland / Longmont / Colorado Springs / Boulder Agenda Item 21 Item # 21 Page 7 BOARD / COMMISSION RECOMMENDATION At its October 12, 2017, meeting, the Energy Board voted unanimously to support the electric rate increase for 2018 for the Electric Fund, as proposed by staff, as well as voted 6-1 to support implementing the standard TOU rate in October 2018, as proposed by staff. See attached memo provided by the Board. At its August 17, 2017, meeting, the Water Board voted unanimously to support the rate increases for 2018 for the Water and Wastewater Fund, as proposed by staff. PUBLIC OUTREACH Notice of the proposed electric rate increase was published in the Coloradoan, and a mailing was sent to all electric customers residing outside of the city limits in accordance with state requirements. Staff plans to conduct outreach to all customers following the adoption of the Ordinances utilizing a variety of tactics, including printed communication material, face-to-face meetings, online resources and social media. ATTACHMENTS 1. Work Session Agenda Item Summary, July 11, 2017 (w/o attachments) (PDF) 2. Work Session Summary, July 11, 2017 (PDF) 3. Energy Board Time of Use Memo, October 12, 2017 (PDF) 4. Powerpoint presentation (PDF) DATE: STAFF: July 11, 2017 Randy Reuscher, Utility Rate Analyst Lance Smith, Utilities Strategic Finance Director WORK SESSION ITEM City Council SUBJECT FOR DISCUSSION Electric Residential Time-of-Use Implementation. EXECUTIVE SUMMARY The purpose of this item is to discuss the timeline and customer outreach plan to implement a residential electric time-of-use (TOU) rate in March 2018 or October 2018. Staff is recommending a standard TOU rate, rather than the TOU with tier option, be implemented for residential customers, including residential tiered, demand and solar net metering customers. GENERAL DIRECTION SOUGHT AND SPECIFIC QUESTIONS TO BE ANSWERED Does Council wish to consider a time-of-use electric rate in the third or fourth quarter of 2017, with a launch date of March 1, 2018, or October 1, 2018? BACKGROUND / DISCUSSION Residential customers are currently billed under tiered electric rate, where tier 1 consumption is lower than the cost-of-service and a progressively higher step charge per kWh for tier 2 and tier 3 consumption (see first graph below). In 2014, staff identified two TOU rate structures to test for possible future implementation (see two TOU graphs below). During a January 2015 work session, an ad hoc committee was formed (Councilmembers Campana and Cuniff with Kevin Gertig, Lisa Rosintoski and Lance Smith from Utilities) to review the specific rate details of the TOU pilot study. Council approved the ordinance in July 2015 to launch the pilot. Staff conducted a 12-month pilot study on two separate TOU rates structures from November 2015 to October 2016. The results were presented to Council at the February 28 Work Session. On May 3, prior to the Council Retreat, a follow-up memo, along with a more detailed written report on the pilot study, was provided to Council to allow for discussion on the topic. The detailed timeline is reflected below: January 2015 Council Ad Hoc Committee formed to review TOU rate structures July 2015 Council approved Ordinance 078, 2015 for the TOU pilot study November 2015 12-month pilot study began ATTACHMENT 1 July 11, 2017 Page 2 October 2016 Pilot study ended and survey sent December 2016 Statistical analysis performed and best-bill credits applied February 2017 Presented results at February 28 Work Session March – May 2017 Presented results to boards with unanimous support of TOU Customer Outreach The memo submitted in May 2017 (Attachment 3) outlined proposed timelines and the TOU Rates Communication Plan, that recognized the following needs: • Develop messaging, look and feel of campaign • Design outreach and education materials • Consult community boards and groups prior to City Council action • Provide thorough customer engagement prior to effective date • Ongoing outreach and communications engagement after effective date During the pilot study, customers were sent postcards with graphics similar to what is shown below to help educate them around seasonal changes in on-peak hours and costs that included the specific rates. Based on the TOU pilot study feedback, staff would provide similar outreach upon full rollout. Examples may include postcards, letters, utility bill inserts, refrigerator magnets, etc. As it is not recommended that a new rate structure be deployed during the summer peak season to support a focused customer outreach experience, the suggested deployment is either March or October 2018. These proposed date options allow for time and resources to best create communication and community engagement plans and outreach tools that will be needed for overall mass communication, as well as more specific targeted communication to reach the many smaller customer segments within the broader residential customer class. In addition, key stakeholder groups have been identified to make formal presentations to as part of their regularly scheduled meetings. Strategies for mass communication, targeted communication and stakeholder collaboration have also been developed. Staff is considering two timelines for implementation, as shown below. Option 1 Option 2 Resolution / Ordinance to Council 3rd Quarter 2017 4th Quarter 2017 Customer Communications 6 months 11 months TOU Effective Date March 1, 2018 October 1, 2018 TOU and Low-income Customer Considerations Over the past two years, staff worked on developing an income-qualified rate. Having this in place would allow customers that qualified through the Low-Income Energy Assistance Program (LEAP) to receive a discount on their utility services. It would also allow this group to receive key messaging on ways to conserve and further July 11, 2017 Page 3 lower their bills through education and available utility programs that provide customer rebates on energy efficient appliances, bulbs, shower heads, etc. The pilot income-qualified rate was presented to City Council in 2016, with Council deciding to table the discussion indefinitely. Staff continues to support a separate low-income (income-qualified) rate pilot to collect data on reaching this segment and property owners more effectively, as has been demonstrated in other cities across the nation. Based on census block data, there is some correlation between income and consumption. For every three low- income customers that may benefit by adding a tiered component to the TOU rate structure, one will be negatively impacted. These are low-income customers with higher than average consumption that may not have the means to invest in energy efficient measures. Therefore, any inclusion of a tiered component in a rate structure solely to address low-income concerns does not appear to be the most effective way to support these households and the cost of utility challenges they may face based on their needed lifestyle. Alternatively, an income-qualified rate would provide a benefit to all qualified customers, and still provide a time-based, energy conservation signal, thus sending the message of two options in managing utility costs, both time-based and consumption-based. There are low-income customers that have above average consumption needs for reasons mostly out of their control. They may: • live in an inefficient home with poor quality insulation or windows, which they may not own or be able to afford upgrades • have inefficient appliances and may not be able to benefit from upgrades even though utility rebates may be available • having a large family in one dwelling unit, that may still be more efficient on a per person basis, but not on a per dwelling basis The graph below compares the average cost between the two TOU rates. The crossover between the average costs is ~950 kWh. The cumulative density function (CDF) represents the monthly kWh consumption, as a percentage on the secondary axis, and relates cost differences between the TOU and TOU w/tier customers in the pilot study. From the CDF, we can see that about 90 percent of bills are for 950 kWh or less, which shows about 90 percent of customers pay more on the plain TOU rate, as compared to the TOU w/tier. Based on this data, TOU sends a larger price conservation signal than TOU w/tier for the majority of our customers. July 11, 2017 Page 4 The graph below shows bill distributions for customers on the TOU rate during the pilot study in the lower-third, middle-third, and upper-third income groups. Low-income customers would be impacted roughly the same as other higher income customers. The graph below shows bill distributions for customers on the TOU w/tier rate during the pilot study in the lower- third, middle-third, and upper-third income groups. Low-income customers would be impacted slightly less, on average, than other middle- and upper-income customers. July 11, 2017 Page 5 Under the current tiered rate structure, approximately 70 percent of residential customers pay less than the full cost of serving them. The 30 percent of the residential customers who use the most energy each month, for any variety of reasons, are subsidizing the rest of the rate class. The TOU rate structure removes this subsidy. The TOU w/tier keeps part of this subsidy in place. Any subsidy undermines the effectiveness of providing a conservation price signal. TOU and Climate Action Goal Impacts Due to the fact there is not an organized energy market in our region we cannot calculate the marginal generation emissions at any given time, which means calculating the exact Greenhouse Gas (GHG) impacts from the piloted rate study is not possible. If Fort Collins customers use less energy, Platte River Power Authority does not reduce electricity production. Instead, any reduction in energy consumption increases the excess electricity available to sell on the market. These additional sales from Platte River replace sales from another (the marginal) generation source on the regional electric system, and the reduction in emissions from the marginal generator is the emission savings from the reduction in use in Fort Collins. Thus, reduced energy use within Fort Collins requires less energy to be generated regionally, but the emission savings is from a peaking facility owned by another utility. We can, however, put bounds on the GHG savings by calculating a worst-case scenario. Given the measured shift in the portion of energy consumed on-peak to off-peak of 0.4 percent, and the overall reduction in consumption for TOU customers of 2.5 percent, we can calculate the worst-case scenario for GHG savings. If all of the marginal resources on-peak are zero emissions (an overly conservative assumption), and all of the off-peak emissions come from coal generators, then the GHG savings amounts to 2 percent at minimum. Note, this worst case scenario is unrealistic, but it gives a lower bound for savings. Using a more likely on-peak emissions factor from the EPA’s eGRID resource suggests that the GHG savings are likely to be at least 2.3 percent for the TOU rates. The takeaway is that the overall reduction in energy consumption outweighs a shift in when energy is consumed, and therefore, does provide a reduction in GHG emissions of at least 2 – 2.3 percent. TOU also incentivizes electric vehicle (EV) owners to charge during off-peak hours at lower rates, allowing them to avoid higher costs from any form of tiered charges, therefore supporting the City’s climate action goals. Implementing a TOU w/tier would result in a higher cost for EV ownership. TOU and On-Peak Hour Considerations The on-peak hours were established based on historical analysis of Platte River’s hourly system peaks. Generally, system peaks occur during early afternoon to early evening hours in the summer months, and in the evening hours during the non-summer months. The higher demands during peak hours require use of more July 11, 2017 Page 6 expensive generation resources, including peaking units; therefore form the cost-based reason for implementing a TOU rate. Finding a balance in the size of the on-peak window is the goal, taking into consideration that a window that is too broad doesn’t allow customers to shift their usage patterns and a window too narrow may not adequately capture the system peaks and require future changes to the on-peak hours. Staff determined that the hours established in the table below, with a 4-hour window during the non-summer months and a 5-hour window during the summer months, are the shortest peak windows that still capture the majority of the system peaks, based on 10 years of historical data. These windows are also consistent with industry guidance around the proper number of peak- period hours to encourage conservation and demand reduction. Since there is a noticeable difference between the seasonal coincident peak times, staff set different on-peak hours for each season. Expanding the on-peak hours to be from 2-9 p.m., so customers could become accustom to one on-peak window was considered, but staff felt it was too broad for customers to be able to react to in terms of conservation and demand shifts. It also doesn’t seem reasonable because summer peaks never occur at 9 p.m. and non-summer peaks never occur at 2 p.m. If these hours were to be excluded and a shorter peak window was adopted year-round, the rate would not correctly capture the costs driven by the peak hour demands and charged at the wholesale level by Platte River. \ Impacts of Tiered Rates and Adding a Tiered Component to TOU Utilities rolled out the residential tiered rate in February 2012 to residential customers. One of the main drivers of moving to the tiered rate from the flat rate is that such a structure was believed to promote energy conservation. To understand the impacts, analysis was done to compare 2013 residential consumption data (on tiered rates) to 2011 data. The data was weather-normalized and adjusted for increases in customer counts, etc. The results showed essentially no reduction in energy consumption. Under a tiered rate, roughly 65 percent of the energy sales are in tier 1, which is at a rate lower than the average cost-of-service. Studies have shown that the discount given to tier 1 customers may actually increase overall consumption in total, the opposite effect of the intended results. This is only partially offset by higher tier 2 and tier 3 charges. Due to the nature of a not-for-profit utility, the tier 1 charge must be set below cost-of-service levels to ensure the utility does not over collect in total due to the higher tier charges. July 11, 2017 Page 7 In the TOU pilot study, both of the rates showed a 2.5 percent reduction in energy consumed over the current tiered rate. Adding a tier to the TOU rate did not result in additional consumption reductions beyond the 2.5% seen with the standard TOU rate. Tiered rates also create more volatility for both the customer and the utility due to fluctuations in consumption driven by high temperatures (increased air conditioning load), cold temperatures (increased electric heating), the addition of an electric vehicle, larger families, etc., which could push their total usage into a higher cost per kWh tier. For reference, see https://energyathaas.wordpress.com/2015/06/29/winners-and-losers-from-flattening-tiered- electricity-prices/ This link describes the “Winners and Losers from Flattening Tiered Electricity Rates” Paraphrasing from the link above on arguments for tiered pricing - • Increasing-block pricing yields conservation. o While in theory this could happen, the best empirical work on this subject, by Professor Koichiro Ito, shows that it is likely to have about zero effect on overall consumption. It does encourage high-consumers to consume less, but it also encourages lower-using households to consume more. Professor Ito shows that the net effect is no reduction in overall consumption. • Supplying electricity to high-use households is more expensive per kWh on average, because they consume more at peak times. o Research has shown the difference is so small that it would justify less than a one-cent differential in price between high-use and low-use customers. • Higher-use customers are on average higher-income customers. o That’s true, as shown in research, however, most states have a separate tariff for the lowest- income customers. Is tiered pricing built into the standard residential rate an effective way to help low-income households? TOU and Solar Customer Impacts Following the staff presentation of TOU pilot results to the Energy Board in March 2017, questions arose about impacts to net-metered customers relative to PUC and statutory standards for calculating net-metering credits. While the City is generally exempt from PUC regulations and rate-setting statutes, moving to a TOU rate structure will more closely align the City’s net-metering compensation formula with benchmark PUC requirements for non- municipal public utilities. The proposed TOU rate will allow the Utility to better offset a net-metered customer’s consumption by its generation than is possible with a tiered rate structure. Net-metered customers will experience a more uniform and transparent credit/compensation process under a TOU rate. Moving solar net metering customers to a TOU rate sends the same time and price signal to those with rooftop solar as the rest of the residential customers. Since the current tiered rate does not have a time-based component built in, there is a slight negative impact to solar customers on a TOU rate of $2.82 per customer per month, which takes into account solar production occurring earlier in the afternoon than when the system peaks occur. These customers do receive the retail rate credit at the associated on-peak and off-peak times and rates. The graphs below show the average production curves of solar during a summer and non-summer month. The solid gray blocks represent the on-peak hours during the season, based on Platte River’s system peaks. Solar production, on a clear day, always peaks between noon and 2 p.m. Most of the negative financial impact to these customers occurs during the non-summer months, as essentially no solar production is occurring during the on- peak hours, so all excess production is credited at the off-peak rate. This is mostly offset during the summer months, where there is a better alignment of solar production and on-peak hours, so the customer receives the higher on-peak credit during those hours. Alternatively, while the impacts to solar customers on the TOU w/tier rate are essentially zero on average, as compared to the current tiered rate, staff does not recommend putting these customers on the TOU w/tier rate structure because costs for energy efficiency programs are being recovered through this additional tier July 11, 2017 Page 8 component, instead of the on-peak and off-peak charges. Due to the offset of their solar production, these customers would not be contributing funds to support energy efficiency programs at the same level as another residential customer with the same household consumption, and yet may have received benefit of solar rebates, etc, that are funded by such programs. As more and more residences adopt solar within our community, those residences that can’t afford to adopt solar or are rental properties will bear more and more of the cost of the solar programs. TOU and Residential Demand (Electric Heat) Customers Staff recommends moving residential demand customers (homes that are all-electric) to the TOU rate structure. This sends the same time-based price signal to these customers as the rest of the residential class during on- peak hours. These customers do not currently have an incentive to reduce on-peak consumption. Due to their higher electric consumption overall (no natural gas consumption offset), adding a tier component to the TOU rate would negatively impact these customers more than the standard TOU rate, in particular during the non-summer months. Moving them to the TOU w/tier rate would create an intra-class subsidy, so staff does not recommend the tiered option for this customer group. BOARD OUTREACH Results of the pilot study were presented to the Energy Board on March 9, 2017, and to the Air Quality Board on May 15, 2017, with both boards voting unanimously in support of implementing a residential TOU rate structure as recommended by staff. July 11, 2017 Page 9 STAFF RECOMMENDATION Staff proposes implementing a standard TOU rate as a default rate to all residential customers, including those on the current tiered rate, demand rate and net metering rate, effective either March 1, 2018, or Oct 1, 2018, based on the following: • Considered by staff and the industry to be a more “fair and equitable” rate structure than a tiered rate (i.e. less intra-class subsidy than either tiered rate) • Creates a 2.5 percent reduction in energy consumption, as compared to the tiered rate • Allows customers to shift demands during the day, providing an additional way to save on their bill • Better aligns benefits of solar production with costs than a tiered rate • Encourages use of electric vehicles, consistent with community climate goals • Reduces GHG emissions by 2 percent or more, as compared to the tiered rate Staff does not recommend a mid-year implementation, when higher summer season rates are in effect. Why staff does not recommend a TOU w/tier rate? • It does not provide an additional energy conservation signal over the standard TOU rate • Customers on the TOU rate had a larger behavioral response and shifted their usage away from the peak period more often than customer on TOU w/tier rate, and it appears customers on the TOU w/tier rate were less likely to shift when they used energy on a daily basis. • It impacts residential demand customers more financially by adding a tier, due to their higher consumption needs for electric heat • May help some low-income customers with lower bills, but it will also create higher bills for some low- income customers (more than the standard TOU rate) o Staff believes low-income should be addressed through a separate rate such as the income- qualified rate that staff presented as a pilot to Council in 2016, which will help support specific, qualified households. • Provides an additional subsidy to solar net metering customers • Discourages electric vehicle charging, as higher consumption will force them into a higher per kWh charge • Creates additional challenges with messaging to customers and their understanding of a rate structure Option 2 (low data resolution) and Option 3 (non-radio) Customers Those customers concerned with privacy, and therefore provided with a low data resolution option (a single number reflecting total energy consumption for the month), are referred to as “Option 2” customers and those who opted for a non-radio meter, and require a manual meter reading each month, are referred to as “Option 3” customers. There are approximately 426 customers combined in these two groups. Staff recommends eliminating Option 2 due to special meter configuration challenges and additional expenses. Customers would be able to select between the default setup or move to Option 3, which require an additional monthly fee for manually collecting meter readings, that will need to be modified going forward. Under either TOU rate, two monthly consumption numbers will be manually collected for Option 3. NEXT STEPS If Council supports implementing a TOU rate, staff will return with a resolution or ordinance for Council consideration prior to beginning the public outreach process. This provides staff time for proper outreach and education to inform all residential customers of TOU rates ahead of deployment. July 11, 2017 Page 10 ATTACHMENTS 1. Review of Time-of-Use Electric Rate Pilot Study (PDF) 2. Work Session Agenda Item Summary, February 28, 2017 (PDF) 3. Council memo, May 3, 2017 (PDF) 4. Energy Board minutes, March 9, 2017 (PDF) 5. Air Quality Advisory Board minutes, May 15, 2017 (PDF) 6. Powerpoint presentation (PDF) ATTACHMENT 2 Utilities – Energy Board 700 Wood St. PO Box 580 Fort Collins, CO 80522 970.221.6702 970.416.2208 - fax fcgov.com M E M O R A N D U M DATE: October 13, 2017 TO: Mayor and City Councilmembers Cc: Darin Atteberry, City Manager FROM: Peter M. O’Neill, Energy Board Chairperson RE: Time of Use Electric Rates At our October 12 meeting the Energy Board received a presentation on Utilities’ proposed Residential Electric Time of Use (TOU) rate ordinance. The Board voted to recommend that City Council move forward with the mandatory residential TOU rate Option 1, a standard rate for all residential customers, as recommended by Staff. As we stated in our March 16, 2017 memo to City Council, the Energy Board supports Time of Use rates in general for these reasons: They  More accurately account for the costs to generate and deliver electricity.  Reduce electrical demand, i.e. the peak power drawn from the system that determines the size of, hence the capital investment in, the system.  Reduce energy consumed.  Properly value solar electric energy generation.  Encourage installation of electric energy storage alongside solar generation to shift its peak in time to match the load peak.  Encourage the scheduling of electric vehicle charging to better utilize the electric system. Further, we support standard TOU rates (without a tier) for these reasons:  A rate structure needs to be easy for the customer to understand if it is to affect their behavior. Tiers would further complicate the understanding of rates that vary by time of day and season of the year.  Some customers are offended by what they perceive to be the implication of tiers that the City has set an expectation of their household energy use without regard to their family size, working arrangements, and other aspects of their lives that they are free to choose.  Utilities’ rigorous pilot study found that tiered rates caused no energy conservation. Respectfully submitted on behalf of the Energy Board, Peter M. O’Neill, Chairperson Energy Board DocuSign Envelope ID: 587D7978-EA80-4D9E-AFAD-658B966AF29E ATTACHMENT 3 1 2018 Proposed Utility Rates City Council – First Reading November 7, 2017 ATTACHMENT 4 2018 Rate Summary 2 UTILITY ORDINANCE 2018 PROPOSED INCREASE NOTES ELECTRIC Option 1 - TOU Option 2 - TOU+tier Option 3 - TOU & TOU+tier 1.8% Same for all rate classes WATER 5% Varies by rate class (between 3.6% and 6.6%) WASTEWATER 3% Varies by rate class (between 1.5% and 5.4%) STORMWATER 0% Electric Rate Increase 1.8% rate increase • 1.4% related to wholesale cost increases • 0.4% to increase operating income by $500k/year • Increased capital investments in the future Water Rate Increase 5% rate increase for managing source of supply to tap: • 10 year Capital Improvement Plan • Increase financial agility of the Enterprise Wastewater Rate Increase 3% rate increase for the fund: • Infrastructure improvements • Replacement of aging pipes in distribution system 2018 Residential Typical Bill Current Estimated $ % 2017 2018 Increase Increase Electric 700 kWh/mo Stormwater 8,600 sq.ft. lot, light runoff Wastewater 4,000 gal/mo $33.22 $33.72 WQA Water 5 kGAL non-summer, 15 kGAL summer Total Estimated Average Monthly Utility Bill $164.73 $168.43 $3.70 2.2% $14.69 $14.69 $0.00 0.0% $0.50 1.5% $45.75 $47.67 $1.92 4.2% $71.07 $72.35 $1.28 1.8% * * Electric Time-of-Use Timeline 7 NOV 2015 12-month pilot study began OCT 2016 Pilot study ended FEB 2017 Results presented to Council OCT 2018 Potential implementation of default TOU rate JAN 2015 Council ad hoc rate committee Staff recommendation & timeline reviewed with Council JUL 2017 NOV 2017 Three ordinance options presented TOU Rate Overview 8 Weekend and holiday hours are off-peak TOU Ordinance Options 9 • Standard TOU rate for all residential Option 1 customers – recommended by staff • TOU +Tier rate for all residential Option 2 customers • TOU + Tier for all residential other than electric heat customers would be on standard TOU Option 3 (combination) Council Direction 10 UTILITY ORDINANCE 2018 PROPOSED INCREASE NOTES ELECTRIC Option 1 - TOU Option 2 - TOU+tier Option 3 - TOU & TOU+tier 1.8% Same for all rate classes WATER 5% Varies by rate class (between 3.6% and 6.6%) WASTEWATER 3% Varies by rate class (between 1.5% and 5.4%) STORMWATER 0% 11 Customer Groups 12 Community Outreach Mass Communication • Utility bill inserts • Brochures • Social media (Nextdoor) • Website Targeted Communication • Electric heat • Low-income • Multi-family • Net metering – Solar • Electric vehicle charging • Stay-at-home/ work-at-home Stakeholder Collaboration • Boards/commissions • Low-income nonprofits • HOAs • Larimer County Conservation Corps • Poudre School District 13 Outreach Timeline 14 Council Decision Nov. 2017 Develop Campaign Winter 2017-2018 Outreach Spring/Summer 2018 Launch Oct. 2018 Summer Outreach Spring 2019 Why TOU Rates? 15 Monitor My Use Time-of-Use Rates -1- OPTION 1 ORDINANCE NO. 155, 2017 OF THE COUNCIL OF THE CITY OF FORT COLLINS AMENDING CHAPTER 26 OF THE CODE OF THE CITY OF FORT COLLINS TO REVISE ELECTRIC RATES, FEES, AND CHARGES, AND UPDATING RELATED PROVISIONS WHEREAS, the City Council is empowered and directed by Article XII, Section 6, of the City Charter to fix, establish, maintain and provide for the collection of such rates, fees or charges for utility services furnished by the City as will produce revenues sufficient to pay the costs, expenses and other obligations of the electric utility, as set forth therein; and WHEREAS, the rates, fees or charges for utility services set forth herein are necessary to produce sufficient revenues to provide the utility services described herein; and WHEREAS, the revenue from the rates, fees or charges for utility services set forth herein shall be used to defray the costs of providing such utility services as required by the Charter and the City Code; and WHEREAS, the City purchases bulk wholesale electric power from Platte River Power Authority (“PRPA”) pursuant to an Amended Contract for Supply of Electric Power and Energy, dated September 1, 2010; and WHEREAS, PRPA costs are increasing due to reduced wholesale market prices and surplus sales, increased costs for coal, and increased operating costs for aging plants; and WHEREAS, PRPA will increase the City’s wholesale cost of power approximately 2.0% in 2018; and WHEREAS, the increased wholesale power cost will require an average 1.4% retail rate increase and increased local distribution costs will require an additional average 0.4% rate increase, for a total City retail electric rate increase in 2018 of 1.8% in order to remain consistent with Article XII, Section 6, of the City Charter; and WHEREAS, the proposed rate increase will vary based on the cost of service to each customer class; and WHEREAS, since 2012, residential customers have been billed under “tier” based electric rates, where tier 1 consumption is lower than the cost-of-service and a progressively higher step charge per kWh is applied for tier 2 and tier 3 consumption, in an effort to encourage energy conservation and efficiency in the rate class; and WHEREAS, as presented at the July 11, 2017, City Council work session, staff has identified benefits available through “time-of-use” (“TOU”) based residential electric rates, compared to tiered electric rates, including aligning retail pricing with PRPA’s wholesale power costs paid by the City for total system consumption; and -2- WHEREAS, adopting residential TOU rates will also enable the City to better leverage incentives in electric rates to encourage energy conservation and efficiency, and equitably shift energy costs to residential customers who use more energy; and WHEREAS, based on direction provided by the City Council on July 11, 2017, staff developed optimal rates, fees and charges for TOU residential electric services, as further set forth herein and as necessary to produce sufficient revenues to provide the utility services described herein; and WHEREAS, staff’s TOU rate recommendations include discontinuing the Residential Demand (“RD”) rate for all-electric heat customers, effective for all billings issued with meter readings on or after October 1, 2018, as the TOU rate will provide uniform energy conservation incentives for all residential customers, eliminating the need for the special rate; and WHEREAS, in addition to adjusting the electric rates, Utilities staff has identified formatting and maintenance updates to Chapter 26 of the City Code necessary to improve the clarity with which electric rates are stated; and WHEREAS, the Energy Board considered the proposed TOU electric rates at its March 9, 2017, and May 11, 2017, regular meetings, and the proposed tiered rates, fees, and charges, and language clarifications for 2018 at its October 12, 2017, regular meeting, and provided recommendations of approval of both rate sets to City Council; and WHEREAS, the City Manager and staff have recommended to the City Council the following tiered electric rate adjustments and City Code rate language clarifications for all electricity used by commercial rate classes customers (GS, GS25, GS50, GS750, and SS) on or after January 1, 2018, and for all other customer classes for all billings issued with meter readings on or after January 1, 2018; and WHEREAS, with regard to residential customers, the City Manager and staff further recommend to the City Council TOU electric rate adjustments and City Code rate language clarifications to transition such customers from tiered rates, effective for all billings issued with meter readings on or after October 1, 2018; and WHEREAS, the City Manager and staff have recommended that the residential tiered rates described in this Ordinance remain in effect from January 1, 2018, until September 30, 2018, and that TOU-based rates go into effect for all residential rate class billings issued on meter readings on or after October 1, 2018; and WHEREAS, based on the foregoing, it is the desire of the City Council to amend Chapter 26 of the City Code to revise the electric rates, fees and charges. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: -3- Section 1. That the City Council hereby makes and adopts the determinations and findings contained in the recitals set forth above. Section 2. That Section 26-391 of the Code of the City of Fort Collins is hereby amended by the addition of a new definition to read as follows: Holiday shall mean the twenty-four (24) hour calendar day for each of the following: New Year’s Day, Memorial Day, July 4th, Labor Day, Thanksgiving Day, and Christmas. Section 3. That Sections 26-464 (c), (d), (f), (p), (r), and (s) of the Code of the City of Fort Collins are hereby amended to read as follows: Sec. 26-464. Residential energy service, schedule R. . . . (c) Monthly rate. (1) Tiered. The monthly rates for this schedule shall be the sum of the following charges, applied to all meter readings on or after January 1, 2018, through September 30, 2018: (1) Fixed Charge Per account $5.79 $5.81 (2) Distribution facilities charge Per kWh $0.0256 $0.0257 (3) Energy and demand charge a. Summer. For billings based on meter readings Dduring the summer season billing months of June, July and August, with the summer season billing month determined by the month the meter is read, and provided that no customer shall be billed more than three (3) full billing cycles at the summer rate. 1. Tier 1 - for the first five hundred (500) kilowatt hours per month 2. Tier 2 - for the next five hundred (500) kilowatt hours per month 3. Tier 3 - for all additional kilowatt hours per month Per kWh $0.0634 $0.0647 Per kWh $0.0807 $0.0823 Per kWh $0.1150 $0.1173 b. Non-summer. For billings based on meter readings Dduring the non-summer season billing months of January through May and September through December. 1. Tier 1 - for the first five hundred (500) kilowatt hours per month, per kWh 2. Tier 2 - for the next five hundred (500) kilowatt hours per month, per kWh Per kWh $0.0583 $0.0595 Per kWh $0.0625 $0.0638 -4- 3. Tier 3 - for all additional kilowatt hours per month, per kWh Per kWh $0.0719 $0.0733 (4) Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent (2) Time-of-use. The monthly rates for this schedule shall be the sum of the following charges, applied to all meter readings on or after October 1, 2018: a. Fixed Charge Per account $5.81 b. Distribution facilities charge Per kWh $0.0257 c. Energy and demand charge 1. Summer. For billings based on consumption during the months of May, June, July, August, and September (a) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) (b) Off-Peak Per kWh $0.2015 Per kWh $0.0428 2. Non-summer. For billings during the months of January through April and October through December. (a) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) (b) Off-Peak Per kWh $0.1788 Per kWh $0.0411 d. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent (d) Medical assistance program. . . . (3) a. Tiered. The discounted monthly rates for customers with electrical durable medical equipment only shall be the sum of the following charges, applied to all meter readings on or after January 1, 2018, through September 30, 2018: a. Fixed Charge Per account $5.79 $5.81 b. Distribution facilities charge Per kWh $0.0256 $0.0257 c. Energy and demand charge -5- 1. Summer. For billings based on meter readings Dduring the summer season billing months of June, July and August, with the summer season billing month determined by the month the meter is read, and provided that no customer shall be billed more than three (3) full billing cycles at the summer rate. (a) Tier 1 - for the first five hundred (500) kilowatt hours per month (b) Tier 2 - for the next five hundred (500) kilowatt hours per month (c) Tier 3 - for all additional kilowatt hours per month Per kWh $0.0358 $0.0363 Per kWh $0.0807 $0.0823 Per kWh $0.1150 $0.1173 2. Non-summer. For billings based on meter readings Dduring the non-summer season billing months of January through May and September through December. (a) Tier 1 - for the first five hundred (500) kilowatt hours per month, per kWh (b) Tier 2 - for the next five hundred (500) kilowatt hours per month, per kWh (c) Tier 3 - for all additional kilowatt hours per month, per kWh Per kWh $0.0318 $0.0325 Per kWh $0.0625 $0.0638 Per kWh $0.0719 $0.0733 d. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent b. Time-of-use. The discounted monthly rates for customers with electrical durable medical equipment only shall be the sum of the following charges, applied to all meter readings on or after October 1, 2018: a. Fixed Charge Per account $5.81 b. Distribution facilities charge Per kWh $0.0257 c. Energy and demand charge 1. Summer. For billings based on consumption during the months of May, June, July, August, and September (c) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) (d) Off-Peak Per kWh $0.1411 Per kWh $0.0300 2. Non-summer. For billings based on consumption during the months of January through April and October through December. (c) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) (d) Off-Peak Per kWh $0.1252 Per kWh $0.0288 d. Payment in lieu of taxes (PILOT) and franchise. 6 percent -6- A charge based on all monthly service charges billed pursuant to this Section (4) a. Tiered. The discounted monthly rates for customers with medical needs requiring air conditioning only shall be the sum of the following charges, applied to all meter readings on or after January 1, 2018, through September 30, 2018: a. Fixed Charge Per account $5.79 $5.81 b. Distribution facilities charge Per kWh $0.0256 $0.0257 c. Energy and demand charge 1. Summer. For billings based on meter readings Dduring the summer season billing months of June, July and August, with the summer season billing month determined by the month the meter is read, and provided that no customer shall be billed more than three (3) full billing cycles at the summer rate. (a) Tier 1 - for the first five hundred (500) kilowatt hours per month (b) Tier 2 - for the next five hundred (500) kilowatt hours per month (c) Tier 3 - for all additional kilowatt hours per month Per kWh $0.0351 $0.0358 Per kWh $0.0446 $0.0454 Per kWh $0.1150 $0.1173 2. Non-summer. For billings based on meter readings Dduring the non-summer season billing months of January through May and September through December. (a) Tier 1 - for the first five hundred (500) kilowatt hours per month, per kWh (b) Tier 2 - for the next five hundred (500) kilowatt hours per month, per kWh (c) Tier 3 - for all additional kilowatt hours per month, per kWh Per kWh $0.0583 $0.0595 Per kWh $0.0625 $0.0638 Per kWh $0.0719 $0.0733 d. Payment in lieu of taxes (PILOT) and franchise. A charge of all monthly service charges billed pursuant to this Section 6 percent b. Time-of-use. The discounted monthly rates for customers with medical needs requiring air conditioning only shall be the sum of the following charges, applied to all meter readings on or after October 1, 2018: a. Fixed Charge Per account $5.81 -7- b. Distribution facilities charge Per kWh $0.0257 c. Energy and demand charge (e) Summer. For billings based on consumption during the months of May, June, July, August, and September (e) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) (f) Off-Peak Per kWh $0.0428 Per kWh $0.0428 (f) Non-summer. For billings based on consumption during the months of January through April and October through December. (g) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) (h) Off-Peak Per kWh $0.1788 Per kWh $0.0411 d. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent (5) a. Tiered. The discounted monthly rates for customers with electrical durable medical equipment and medical needs requiring air conditioning shall be the sum of the following charges, applied to all meter readings on or after January 1, 2018, through September 30, 2018: a. Fixed Charge Per account $5.79 $5.81 b. Distribution facilities charge Per kWh $0.0256 $0.0257 c. Energy and demand charge 1. Summer. For billings based on meter readings Dduring the summer season billing months of June, July and August, with the summer season billing month determined by the month the meter is read, and provided that no customer shall be billed more than three (3) full billing cycles at the summer rate. (a) Tier 1 - for the first five hundred (500) kilowatt hours per month (b) Tier 2 - for the next five hundred (500) kilowatt hours per month (c) Tier 3 - for all additional kilowatt hours per month Per kWh $0.0229 $0.0234 Per kWh $0.0292 $0.0298 Per kWh $0.1150 $0.1173 2. Non-summer. For billings based on meter readings Dduring the non-summer season billing months of January through May and September through December. (a) Tier 1 - for the first five hundred (500) kilowatt hours per month, per kWh Per kWh $0.0318 $0.0325 -8- (b) Tier 2 - for the next five hundred (500) kilowatt hours per month, per kWh (c) Tier 3 - for all additional kilowatt hours per month, per kWh Per kWh $0.0625 $0.0638 Per kWh $0.0719 $0.0733 d. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent b. Time-of-use. The discounted monthly rates for customers with electrical durable medical equipment and medical needs requiring air conditioning shall be the sum of the following charges, applied to all meter readings on or after October 1, 2018: a. Fixed Charge Per account $5.81 b. Distribution facilities charge Per kWh $0.0257 c. Energy and demand charge (i) Summer. For billings based on consumption during the months of May, June, July, August, and September (g) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) (h) Off-Peak Per kWh $0.0428 Per kWh $0.0300 (j) Non-summer. For billings based on consumption during the months of January through April and October through December. (k) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) (l) Off-Peak Per kWh $0.1252 Per kWh $0.0288 d. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent . . . (f) Excess capacity charge. The monthly capacity charge kilowatt set forth in this Subsection (f) may be added to the above charges for service to intermittent loads in accordance with the provisions of the Electric Service Standards. Per kW $2.09 $2.10 . . . (p) Net metering. … -9- (5) a. Tiered. The customer-generator's consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy consumed from the utility consumed by the customer-generator shall be billed at the applicable seasonal tiered rate as outlined in Subsection (c) of this Section. The energy produced by the customer- generator shall be credited to the customer monthly as follows, applied to all meter readings on or after January 1, 2018, through September 30, 2018: a. Distribution facilities credit Per kWh $0.0256 $0.0257 b. Energy and demand credit Per kWh $0.0634 $0.0647 b. Time-of-use. For customer-generators on a "time-of-use" (TOU) rate, consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy from the utility consumed by the customer-generator shall be billed at the applicable rates under Subsection (c) of this Section. The energy produced by the customer- generator shall be credited to the customer monthly as follows, applied to all meter readings on or after October 1, 2018: a. Distribution facilities credit Per kWh $0.0257 b. Energy and demand credit – For billings based on generation during the months of May, June, July, August and September 1. On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) Per kWh $0.2015 2. Off-Peak Per kWh $0.0428 c. Energy and demand credit – For billings based on generation during the months of January through April and October through December 1. On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) Per kWh $0.1788 2. Off-Peak Per kWh $0.0411 . . . (r) Net metering—community solar projects. . . . (3) a. Tiered. Both the customer’s consumption of energy from Fort Collins Utilities and interest in the production of energy that flows into Fort Collins Utilities' -10- distribution system shall be measured on a monthly basis. The energy consumed from Fort Collins Utilities consumed by the customer shall be billed at the applicable seasonal tiered rate as outlined in Subsections (c) and (d) of this Section. The method used to measure energy produced and issue credits under this Section shall be the same for subscriber-owned facilities and dedicated program-managed facilities. The energy produced by the customer's portion of the qualifying facility shall be credited to the customer monthly as follows, applied to all meter readings on or after January 1, 2018, through September 30, 2018: 1. Distribution facilities credit Per kWh $0.0128 2. Energy and demand credit Per kWh $0.0634 $0.0647 b. Time-of-use. For customer-generators on a "time-of-use" (TOU) rate, the customer’s consumption of energy from Fort Collins Utilities and interest in the production of energy that flows into Fort Collins Utilities' distribution system shall be measured on a monthly basis. The energy from the utility consumed by the customer-generator shall be billed at the applicable rates under Subsection (c) of this Section. The method used to measure energy produced and issue credits under this Section shall be the same for subscriber-owned facilities and dedicated program-managed facilities. The energy produced by the customer-generator shall be credited to the customer monthly as follows, applied to all meter readings on or after October 1, 2018: a. Distribution facilities credit Per kWh $0.0128 b. Energy and demand credit – For billings based on generation during the months of May, June, July, August and September 1) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) Per kWh $0.2015 2) Off-Peak Per kWh $0.0428 Energy and demand credit – For billings based on generation during the months of January through April and October through December 1) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) Per kWh $0.1788 2) Off-Peak Per kWh $0.0411 (s) Time of Use (TOU) Pilot Study. (1) Objective. The City has identified potential benefits available through time-of- use (TOU) based electric service rates, including encouraging reduced energy -11- consumption and equitably shifting energy costs to customers who use more energy. In order to study these benefits, Fort Collins Utilities shall conduct a temporary pilot project beginning with the billing cycle commencing on or after October 1, 2015, and concluding after twelve (12) full billing cycles. (2) Scope. The project shall include six thousand (6,000) residential energy service (Schedule R) customers selected at random. Customers selected at random will be notified and given a one-time opportunity to "opt-out" of participation in the project. Customers who do not opt-out will be assigned, as determined by the Executive Director, to one (1) of the two (2) pilot rates described in Subsections (s)(4) (pilot TOU rate) and (s)(5) (pilot TOU with energy efficiency tier rate), or monitored on their existing residential energy service tiered rate, as a control group. (3) Best-bill guarantee. Customers participating in the pilot project for the full twelve (12) billing cycle period will be eligible for the following best-bill guarantee: the total energy costs paid by each customer under either of the pilot rates for the twelve (12) full billing cycles shall be compared with the energy costs such customer would have paid under the base residential energy service tiered rate during the same twelve (12) billing cycles, and each customer shall be reimbursed (by issuance of a billing credit or otherwise, as determined by the Executive Director) for the amount by which the total energy costs paid exceed the amount that would have been due under the base residential energy service tiered rate for such period. Each customer who pays total energy costs under either of the pilot rates during the twelve (12) full billing cycles of the project that are less than the energy costs such customer would have paid under the base residential energy service tiered rate shall retain those savings. (4) Pilot TOU rate. Customers assigned to this rate during the pilot study shall pay monthly rates under this sub-schedule equal to the sum of the following charges: a. Fixed Charge Per account $5.07 b. Distribution facilities charge Per kWh $0.0238 c. Energy and demand charge 1. Summer. During the summer season billing months of May, June, July, August, and September (a) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) (b) Off-Peak Per kWh $0.1968 Per kWh $0.0412 2. Non-summer. During the non-summer season billing months of January through April and October through December. (a) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) (b) Off-Peak Per kWh $0.1632 Per kWh $0.0395 -12- d. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent (5) Pilot TOU with energy efficiency tier rate. Customers assigned to this rate during the pilot Study shall pay monthly rates under this sub-schedule equal to the sum of the following charges: a. Fixed Charge Per account $5.07 b. Distribution facilities charge Per kWh $0.0238 c. Energy and demand charge 1. Summer. During the summer season billing months of May, June, July, August, and September (c) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) (d) Off-Peak Per kWh $0.1968 Per kWh $0.0412 2. Non-summer. During the non-summer season billing months of January through April and October through December. (c) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) (d) Off-Peak Per kWh $0.1632 Per kWh $0.0395 d. Energy efficiency tier charge, per kilowatt hour for total consumption over 700 kWh in a billing month (regardless of on- peak or off-peak) Per kWh $0.0163 e. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent Section 4. That Sections 26-465 (c), (e), (f), (q), and (r) of the Code of the City of Fort Collins are hereby amended to read as follows: Sec. 26-465. Residential demand service, schedule RD. . . . (c) Monthly rate. The monthly rates shall be the sum of the following charges, applied to all meter readings on or after January 1, 2018, through September 30, 2018, for all meter readings thereafter the charges shall be those set forth at Section 26-464(c)(2): (1) Fixed Charge Per account $5.79 $5.81 -13- (2) Demand charge Per kW $2.44 $2.45 (3) Distribution facilities charge Per kWh $0.0228 $0.0229 (4) Energy charge a. Summer. For billings based on meter readings in the season billing months of June, July and August b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kWh $0.0443 $0.0452 Per kWh $0.0425 $0.0434 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. (5) Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent ... (e) Excess capacity charge. The monthly capacity charge kilowatt set forth in this Subsection (e) may be added to the above charges for service to intermittent loads in accordance with the provisions of the Electric Service Standards. Per kW $2.09 $2.10 (f) Standby service charges. Standby service, if available, will be provided on an annual contract basis at a level at least sufficient to meet probable service demand (in kilowatts) as determined by the customer and approved by the utility according to the following: (1) Monthly standby distribution charge: . . . (q) Net metering. . . . (5) The customer-generator's consumption of energy from the utility and Contracted standby service, this charge shall be in lieu of the distribution facilities charge. Per kW $2.11 $2.12 For all metered kilowatts in excess of the contracted amount Per kW $6.33 $6.35 -14- production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy consumed from the utility consumed by the customer-generator shall be billed at the applicable seasonal tiered rate as outlined in Subsection (c) of this Section. The energy produced by the customer- generator shall be credited to the customer monthly as follows, applied to all meter readings on or after January 1, 2018, through September 30, 2018, for all meter readings thereafter the charges shall be those set forth at Section 26-464(p)(5)b.: a. Distribution facilities credit Per kWh $0.0256 $0.0257 b. Energy and demand credit Per kWh $0.0634 $0.0647 (r) Net metering-community solar projects. . . . (3) Both the customer's consumption of energy from Fort Collins Utilities and interest in the production of energy that flows into Fort Collins Utilities' distribution system shall be measured on a monthly basis. The energy consumed from Fort Collins Utilities consumed by the customer shall be billed at the applicable seasonal tiered rate as outlined in Subsection (c) and (d) of this Section. The method used to measure energy produced and issue credits under this Section shall be the same for subscriber-owned facilities and dedicated program-managed facilities. The energy produced by the customer's portion of the qualifying facility shall be credited to the customer monthly as follows, applied to all meter readings on or after January 1, 2018, through September 30, 2018, for all meter readings thereafter the charges shall be those set forth at Section 26-464(r)(3)b.: 1. Distribution facilities credit Per kWh $0.0128 2. Energy and demand credit Per kWh $0.0634 $0.0647 Section 5. That Sections 26-466 (c), (e), (q), and (r) of the Code of the City of Fort Collins are hereby amended to read as follows: Sec. 26-466. General service, schedule GS. . . . (c) Monthly rate. The monthly rates for this schedule shall be the sum of the following charges: -15- 1. Fixed Charge a. Single-phase, two-hundred-ampere service Per account $3.60 $3.61 b. Single-phase, above two-hundred-ampere service Per account $10.61 $10.65 c. Three-phase, two-hundred-ampere service Per account $5.48 $5.50 d. Three-phase, above two-hundred-ampere service Per account $12.98 $13.03 2. Demand charge a. Summer. For billings based on meter readings in the season billing months of June, July, and August Per kWh $0.0268 $0.0273 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kWh $0.0164 $0.0167 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. 3. Distribution facilities charge Per kWh $0.0244 $0.0245 4. Energy charge a. Summer. For billings based on meter readings in the season billing months of June, July, and August Per kWh $0.0443 $0.0452 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kWh $0.0425 $0.0434 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. 5. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent ... (e) Excess capacity charge. The monthly capacity charge per kilowatt set forth in this Subsection (e) may be added to the above charges for service to intermittent loads in accordance with the provisions of the Electric Service Standards. -16- Per kW $2.09 $2.10 . . . (q) Net metering. . . . (5) The customer-generator's consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy consumed from the utility consumed by the customer-generator shall be billed at the applicable rate as outlined in Subsection (c) of this Section. The energy produced by the customer-generator shall be credited to the customer monthly as follows: a. Summer season eEnergy credit for billings based on generation during the months of June, July and August Per kWh $0.0443 $0.0452 (r) Net metering-community solar projects. . . . (3) Both the customer's consumption of energy from Fort Collins Utilities and interest in the production of energy that flows into Fort Collins Utilities' distribution system shall be measured on a monthly basis. The energy consumed from Fort Collins Utilities consumed by the customer shall be billed at the applicable seasonal tiered rate as outlined in Subsection (c) of this Section. The energy produced by the customer's portion of the qualifying facility shall be credited to the customer monthly as follows: 1. Distribution facilities credit Per kWh $0.0122 2. Energy and demand credit Per kWh $0.0443 $0.0452 Section 6. That Sections 26-467 (c), (e), (f) and (r) of the Code of the City of Fort Collins are hereby amended to read as follows: Sec. 26-467. General service 25, schedule GS25. . . . (c) Monthly rate. The monthly rates for this schedule shall be the sum of the following -17- charges: 1. Fixed Charge a. Single-phase, two-hundred-ampere service Per account $3.60 $3.61 b. Single-phase, above two-hundred-ampere service Per account $10.61 $10.65 c. Three-phase, two-hundred-ampere service Per account $5.48 $5.50 d. Three-phase, above two-hundred-ampere service Per account $12.98 $13.03 2. Demand charge a. Summer. For billings based on meter readings in the season billing months of June, July, and August Per kW $8.28 $8.31 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kW $4.74 $4.76 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. 3. Distribution facilities charge Per kwh $0.0185 $0.0186 4. Energy charge a. Summer. For billings based on meter readings in the season billing months of June, July, and August Per kWh $0.0443 $0.0452 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kWh $0.0425 $0.0434 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. 5. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent ... (e) Excess capacity charge. The monthly capacity charge kilowatt set forth in this Subsection (e) may be added to the above charges for service to intermittent loads in accordance with the provisions of the Electric Service Standards. -18- Per kW $2.09 $2.10 (f) Standby service charges. Standby service, if available, will be provided on an annual contract basis at a level at least sufficient to meet probable service demand (in kilowatts) as determined by the customer and approved by the utility according to the following: (1) Monthly standby distribution charge Contracted standby service, this charge shall be in lieu of the distribution facilities charge. Per kW $3.83 $3.84 For all metered kilowatts in excess of the contracted amount Per kW $11.50 $11.54 . . . (r) Net metering. . . . (5) The customer-generator's consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy consumed from the utility consumed by the customer-generator shall be billed at the applicable rate as outlined in Subsection (c) of this Section. The energy produced by the customer-generator shall be credited to the customer monthly as follows: a. Summer season eEnergy credit for billings based on generation during the months of June, July and August Per kWh $0.0443 $0.0452 Section 7. That Sections 26-468 (c), (e) through (g), and (u) of the Code of the City of Fort Collins are hereby amended to read as follows: Sec. 26-468. General service 50, schedule GS50. . . . (c) Monthly rate. The monthly rates for this schedule shall be the sum of the following charges: (1) Fixed Charge Per account $9.08 $9.11 -19- An additional charge may be assessed if telephone communication service is not provided by the customer. Per account $40.00 $40.14 (1) (2) Coincident demand charge a. Ssummer. For billings based on meter readings in the season billing months of June, July and August Per kW $11.68 $11.91 b. Nnon-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kW $8.90 $9.08 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. (3) Distribution facilities charge Per kW $6.25 $6.27 (4) Energy charge a. Summer. For billings based on meter readings in the season billing months of June, July, and August Per kWh $0.0443 $0.0452 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kWh $0.0425 $0.0434 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. (5) Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent ... (e) Excess capacity charge. The monthly capacity charge per kilowatt set forth in this Subsection (e) may be added to the above charges for service to intermittent loads in accordance with the provisions of the Electric Service Standards. Per kW $2.09 $2.10 (f) Standby service charges. Standby service, if available, will be provided on an annual contract basis at a level at least sufficient to meet probable service demand (in kilowatts) as determined by the customer and approved by the utility according to the following: -20- (1) Standby distribution charge. a. Monthly standby distribution charge shall be the sum of the following charges: Contracted standby service, this charge shall be in lieu of the distribution facilities charge. Per kW $4.92 $4.94 For all metered kilowatts in excess of the contracted amount Per kW $14.77 $14.82 . . . (g) Excess circuit charge. In the event a utility customer in this rate class desires excess circuit capacity for the purpose of controlling the available electric capacity of a backup circuit connection, this service, if available, will be provided on an annual contract basis at a level at least sufficient to meet probable backup demand (in kilowatts) as determined by the customer and approved by the utility according to the following: (1) Monthly charge shall be the sum of the following charges: Contracted backup capacity per month Per kW $1.01 Metered kilowatts in excess of the contracted amount Per kW $3.03 $3.04 (2) In the event the contractual kilowatt limit is exceeded, a new annual contract period will automatically begin as of the month the limit is exceeded. The metered demand in the month of exceedance shall become the minimum contracted demand level for the excess circuit charge. . . . (u) Net metering. . . . (5) The customer-generator's consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy consumed from the utility consumed by the customer-generator shall be billed at the applicable rate as outlined in Subsection (c) of this Section. The energy produced by the customer-generator shall be credited to the customer monthly as follows: a. Summer season eEnergy credit for billings based on generation during the months of June, July and August Per kWh $0.0443 $0.0452 Section 8. That Sections 26-469 (c), (e) through (g) and (v) of the Code of the City of Fort Collins are hereby amended to read as follows: -21- Sec. 26-469. General service 750, schedule GS750. . . . (c) Monthly rate. The monthly rates for this schedule shall be the sum of the following charges: (1) Fixed Charge Per account $15.56 $15.62 a. Additional charge for each additional metering point Per account $9.50 $9.53 b. An additional charge may be assessed if telephone communication service is not provided by the customer. Per account $40.00 $40.14 (2) Coincident demand charge a. Summer. For billings based on meter readings in the season billing months of June, July and August Per kW $11.51 $11.74 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kW $8.77 $8.95 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. (3) Distribution facilities charge a. First seven hundred fifty (750) kilowatts Per kW $6.00 $6.02 b. All additional kilowatts Per kW $3.55 $3.56 (4) Energy charge a. Summer. For billings based on meter readings in the season billing months of June, July, and August Per kWh $0.0436 $0.0445 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kWh $0.0419 $0.0427 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. (5) Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent -22- ... (e) Excess capacity charge. The monthly capacity charge per kilowatt set forth in this Subsection (e) may be added to the above charges for service to intermittent loads in accordance with the provisions of the Electric Service Standards. Per kW $2.09 $2.10 (f) Standby service charges. Standby service, if available, will be provided on an annual contract basis at a level at least sufficient to meet probable service demand (in kilowatts) as determined by the customer and approved by the utility according to the following: (1) Standby distribution charge. a. Monthly standby distribution charges shall be paid in the following amounts Contracted standby service, this charge shall be in lieu of the distribution facilities charge. Per kW $3.41 $3.42 For all metered kilowatts in excess of the contracted amount Per kW $10.24 $10.28 . . . (g) Excess circuit charge. In the event a utility customer in this rate class desires excess circuit capacity for the purpose of controlling the available electric capacity of a backup circuit connection, this service, if available, will be provided on an annual contract basis at a level at least sufficient to meet probable backup demand (in kilowatts) as determined by the customer and approved by the utility at the following rates: (1) Monthly charge. . . . (v) Net metering. . . . (5) The customer-generator's consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be Contracted backup capacity per month Per kW $0.70 Metered kilowatts in excess of the contracted amount Per kW $2.10 $2.11 -23- measured on a monthly basis. The energy consumed from the utility consumed by the customer-generator shall be billed at the applicable rate as outlined in Subsection (c) of this Section. The energy produced by the customer-generator shall be credited to the customer monthly as follows: a. Summer season eEnergy credit for billings based on generation during the months of June, July and August Per kWh $0.0436 $0.0445 Section 9. That Sections 26-470 (c), (e), and (s) of the Code of the City of Fort Collins are hereby amended to read as follows: Sec. 26-470. Substation service, schedule SS. . . . (c) Monthly rate. The monthly rates for this schedule shall be the sum of the following charges: (1) Fixed Charge Per account $35.38 $35.51 (2) Coincident demand charge a. Summer. For billings based on meter readings in the season billing months of June, July and August Per kW $11.33 $11.56 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kW $8.64 $8.81 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. (3) Distribution facilities charge Per kW $2.87 $2.88 (4) Energy charge a. Summer. For billings based on meter readings in the season billing months of June, July, and August Per kWh $0.0430 $0.0439 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kWh $0.0412 $0.0420 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. (5) Payment in lieu of taxes (PILOT) and franchise. 6 percent -24- A charge based on all monthly service charges billed pursuant to this Section ... (e) Standby service charges. Standby service, if available, will be provided on an annual contract basis at a level at least sufficient to meet probable service demand (in kilowatts) as determined by the customer and approved by the utility at the following rates: (1) Standby distribution charge. a. Monthly standby distribution charge: Contracted standby service, this charge shall be in lieu of the distribution facilities charge. Per kW $2.55 $2.56 For all metered kilowatts in excess of the contracted amount Per kW $7.65 $7.68 . . . (s) Net metering. . . . (5) The customer-generator's consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy consumed from the utility consumed by the customer-generator shall be billed at the applicable rate as outlined in Subsection (c) of this Section. The energy produced by the customer-generator shall be credited to the customer monthly as follows: a. Summer season eEnergy credit for billings based on generation during the months of June, July and August Per kWh $0.0430 $0.0439 Section 10. That customers on the Residential Demand (RD) rate schedule under Section 26-465 as of September 30, 2018, shall be moved to the Residential (R) rate schedule under Section 26-464 of the Code of the City of Fort Collins, effective for all metering readings on or after October 1, 2018. Section 11. That, effective October 1, 2018, Section 26-465 of the Code of the City of Fort Collins is hereby repealed in whole and the section number reserved for future use. Section 12. That the amendments herein are effective and shall go into effect as follows: a. Amended commercial schedule tiered rates (GS, GS25, GS50, GS750 & SS) shall apply to all electricity consumed on or after January 1, 2018; -25- b. Amended schedules of tiered rates for all other rate classes shall apply to all bills issued on the basis of meter readings on or after January 1, 2018; c. Residential (R) TOU rate schedules shall apply to all bills issued on the basis of meter readings on or after October 1, 2018. Introduced, considered favorably on first reading, and ordered published this 7th day of November, A.D. 2017, and to be presented for final passage on the 21st day of November, A.D. 2017. __________________________________ Mayor ATTEST: _______________________________ City Clerk Passed and adopted on final reading on the 21st day of November, A.D. 2017. __________________________________ Mayor ATTEST: _______________________________ City Clerk -1- OPTION 2 ORDINANCE NO. 155, 2017 OF THE COUNCIL OF THE CITY OF FORT COLLINS AMENDING CHAPTER 26 OF THE CODE OF THE CITY OF FORT COLLINS TO REVISE ELECTRIC RATES, FEES, AND CHARGES, AND UPDATING RELATED PROVISIONS WHEREAS, the City Council is empowered and directed by Article XII, Section 6, of the City Charter to fix, establish, maintain and provide for the collection of such rates, fees or charges for utility services furnished by the City as will produce revenues sufficient to pay the costs, expenses and other obligations of the electric utility, as set forth therein; and WHEREAS, the rates, fees or charges for utility services set forth herein are necessary to produce sufficient revenues to provide the utility services described herein; and WHEREAS, the revenue from the rates, fees or charges for utility services set forth herein shall be used to defray the costs of providing such utility services as required by the Charter and the City Code; and WHEREAS, the City purchases bulk wholesale electric power from Platte River Power Authority (“PRPA”) pursuant to an Amended Contract for Supply of Electric Power and Energy, dated September 1, 2010; and WHEREAS, PRPA costs are increasing due to reduced wholesale market prices and surplus sales, increased costs for coal, and increased operating costs for aging plants; and WHEREAS, PRPA will increase the City’s wholesale cost of power approximately 2.0% in 2018; and WHEREAS, the increased wholesale power cost will require an average 1.4% retail rate increase and increased local distribution costs will require an additional average 0.4% rate increase, for a total City retail electric rate increase in 2018 of 1.8% in order to remain consistent with Article XII, Section 6, of the City Charter; and WHEREAS, the proposed rate increase will vary based on the cost of service to each customer class; and WHEREAS, since 2012, residential customers have been billed under “tier” based electric rates, where tier 1 consumption is lower than the cost-of-service and a progressively higher step charge per kWh is applied for tier 2 and tier 3 consumption, in an effort to encourage energy conservation and efficiency in the rate class; and WHEREAS, as presented at the July 11, 2017, City Council work session, staff has identified benefits available through “time-of-use” (“TOU”) based residential electric rates, compared to tiered electric rates, including aligning retail pricing with PRPA’s wholesale power costs paid by the City for total system consumption; and -2- WHEREAS, adopting residential TOU rates will also enable the City to better leverage incentives in electric rates to encourage energy conservation and efficiency, and equitably shift energy costs to residential customers who use more energy; and WHEREAS, based on direction provided by the City Council on July 11, 2017, staff developed optimal rates, fees and charges for TOU residential electric services, as further set forth herein and as necessary to produce sufficient revenues to provide the utility services described herein; and WHEREAS, staff’s TOU rate recommendations include discontinuing the Residential Demand (“RD”) rate for all-electric heat customers, effective for all billings issued with meter readings on or after October 1, 2018, as the TOU rate will provide uniform energy conservation incentives for all residential customers, eliminating the need for the special rate; and WHEREAS, in addition to adjusting the electric rates, Utilities staff has identified formatting and maintenance updates to Chapter 26 of the City Code necessary to improve the clarity with which electric rates are stated; and WHEREAS, the Energy Board considered the proposed TOU electric rates at its March 9, 2017, and May 11, 2017, regular meetings, and the proposed tiered rates, fees, and charges, and language clarifications for 2018 at its October 12, 2017, regular meeting, and provided recommendations of approval of both rate sets to City Council; and WHEREAS, the City Manager and staff have recommended to the City Council the following tiered electric rate adjustments and City Code rate language clarifications for all electricity used by GS50 and GS750 rate class customers on or after January 1, 2018, and for all other customer classes for all billings issued with meter readings on or after January 1, 2018; and WHEREAS, with regard to residential customers, the City Manager and staff further recommend to the City Council TOU electric rate adjustments and City Code rate language clarifications to transition such customers from tiered rates, effective for all billings issued with meter readings on or after October 1, 2018; and WHEREAS, the City Manager and staff have recommended that the residential tiered rates described in this Ordinance remain in effect from January 1, 2018, until September 30, 2018, and that TOU-based rates go into effect for all residential rate class billings issued on meter readings on or after October 1, 2018; and WHEREAS, based on the foregoing, it is the desire of the City Council to amend Chapter 26 of the City Code to revise the electric rates, fees and charges. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That the City Council hereby makes and adopts the determinations and -3- findings contained in the recitals set forth above. Section 2. That Sections 26-391 of the Code of the City of Fort Collins is hereby amended by the addition of a new definition to read as follows: Holiday shall mean the twenty-four (24) hour calendar day for each of the following: New Year’s Day, Memorial Day, July 4th, Labor Day, Thanksgiving Day, and Christmas. Section 3. That Sections 26-464 (c), (d), (f), (p), (r), and (s) of the Code of the City of Fort Collins are hereby amended to read as follows: Sec. 26-464. Residential energy service, schedule R. . . . (c) Monthly rate. (1) Tiered. The monthly rates for this schedule shall be the sum of the following charges, applied to all meter readings on or after January 1, 2018, through September 30, 2018: (1) Fixed Charge Per account $5.79 $5.81 (2) Distribution facilities charge Per kWh $0.0256 $0.0257 (3) Energy and demand charge a. Summer. For billings based on meter readings Dduring the summer season billing months of June, July and August, with the summer season billing month determined by the month the meter is read, and provided that no customer shall be billed more than three (3) full billing cycles at the summer rate. 1. Tier 1 - for the first five hundred (500) kilowatt hours per month 2. Tier 2 - for the next five hundred (500) kilowatt hours per month 3. Tier 3 - for all additional kilowatt hours per month Per kWh $0.0634 $0.0647 Per kWh $0.0807 $0.0823 Per kWh $0.1150 $0.1173 b. Non-summer. For billings based on meter readings Dduring the non-summer season billing months of January through May and September through December. 1. Tier 1 - for the first five hundred (500) kilowatt hours per month, per kWh 2. Tier 2 - for the next five hundred (500) kilowatt hours per month, per kWh Per kWh $0.0583 $0.0595 Per kWh $0.0625 $0.0638 -4- 3. Tier 3 - for all additional kilowatt hours per month, per kWh Per kWh $0.0719 $0.0733 (4) Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent . . . (2) Time-of-use. The monthly rates for this schedule shall be the sum of the following charges, applied to all meter readings on or after October 1, 2018: a. Fixed Charge Per account $5.81 b. Distribution facilities charge Per kWh $0.0197 c. Energy and demand charge 1. Summer. For billings based on consumption during the months of May, June, July, August, and September (a) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) (b) Off-Peak Per kWh $0.2015 Per kWh $0.0428 2. Non-summer. For billings based on consumption during the months of January through April and October through December. (a) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) (b) Off-Peak Per kWh $0.1788 Per kWh $0.0411 d. Energy efficiency tier charge, per kilowatt hour for total consumption over 700 kWh in a billing month (regardless of on-peak or off-peak) Per kWh $0.0166 e. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent (d) Medical assistance program. . . . (3) a. Tiered. The discounted monthly rates for customers with electrical durable medical equipment only shall be the sum of the following charges, applied to all meter readings on or after January 1, 2018, and before September 30, 2018: a. Fixed Charge Per account $5.79 $5.81 -5- b. Distribution facilities charge Per kWh $0.0256 $0.0257 c. Energy and demand charge 1. Summer. For billings based on meter readings Dduring the summer season billing months of June, July and August, with the summer season billing month determined by the month the meter is read, and provided that no customer shall be billed more than three (3) full billing cycles at the summer rate. (a) Tier 1 - for the first five hundred (500) kilowatt hours per month (b) Tier 2 - for the next five hundred (500) kilowatt hours per month (c) Tier 3 - for all additional kilowatt hours per month Per kWh $0.0358 $0.0363 Per kWh $0.0807 $0.0823 Per kWh $0.1150 $0.1173 2. Non-summer. For billings based on meter readings Dduring the non-summer season billing months of January through May and September through December. (a) Tier 1 - for the first five hundred (500) kilowatt hours per month, per kWh (b) Tier 2 - for the next five hundred (500) kilowatt hours per month, per kWh (c) Tier 3 - for all additional kilowatt hours per month, per kWh Per kWh $0.0318 $0.0325 Per kWh $0.0625 $0.0638 Per kWh $0.0719 $0.0733 d. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent b. Time-of-use. The discounted monthly rates for customers with electrical durable medical equipment only shall be the sum of the following charges, applied to all meter readings on or after October 1, 2018: a. Fixed Charge Per account $5.81 b. Distribution facilities charge Per kWh $0.0197 c. Energy and demand charge 1. Summer. For billings based on consumption during the months of May, June, July, August, and September (c) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) (d) Off-Peak Per kWh $0.1411 Per kWh $0.0300 2. Non-summer. For billings based on consumption during the months of January through April and October through December. (c) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) (d) Off-Peak Per kWh $0.1252 Per kWh $0.0288 -6- d. Energy efficiency tier charge, per kilowatt hour for total consumption over 700 kWh in a billing month (regardless of on- peak or off-peak) Per kWh $0.0166 e. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent (4) a. Tiered. The discounted monthly rates for customers with medical needs requiring air conditioning only shall be the sum of the following charges, applied to all meter readings on or after January 1, 2018, through September 30, 2018: a. Fixed Charge Per account $5.79 $5.81 b. Distribution facilities charge Per kWh $0.0256 $0.0257 c. Energy and demand charge 1. Summer. For billings based on meter readings Dduring the summer season billing months of June, July and August, with the summer season billing month determined by the month the meter is read, and provided that no customer shall be billed more than three (3) full billing cycles at the summer rate. (a) Tier 1 - for the first five hundred (500) kilowatt hours per month (b) Tier 2 - for the next five hundred (500) kilowatt hours per month (c) Tier 3 - for all additional kilowatt hours per month Per kWh $0.0351 $0.0358 Per kWh $0.0446 $0.0454 Per kWh $0.1150 $0.1173 2. Non-summer. For billings based on meter readings Dduring the non-summer season billing months of January through May and September through December. (a) Tier 1 - for the first five hundred (500) kilowatt hours per month, per kWh (b) Tier 2 - for the next five hundred (500) kilowatt hours per month, per kWh (c) Tier 3 - for all additional kilowatt hours per month, per kWh Per kWh $0.0583 $0.0595 Per kWh $0.0625 $0.0638 Per kWh $0.0719 $0.0733 d. Payment in lieu of taxes (PILOT) and franchise. A charge of all monthly service charges billed pursuant to this Section 6 percent -7- b. Time-of-use. This discounted monthly rates for customers with medical needs requiring air conditioning only shall be the sum of the following charges, applied to all meter readings on or after October 1, 2018. a. Fixed Charge Per account $5.81 b. Distribution facilities charge Per kWh $0.0197 c. Energy and demand charge 3. Summer. For billings based on consumption during the months of May, June, July, August, and September (e) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) (f) Off-Peak Per kWh $0.0428 Per kWh $0.0428 4. Non-summer. For billings based on consumption during the months of January through April and October through December. (e) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) (f) Off-Peak Per kWh $0.1788 Per kWh $0.0411 d. Energy efficiency tier charge, per kilowatt hour for total consumption over 700 kWh in a billing month (regardless of on- peak or off-peak) Per kWh $0.0166 e. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent (5) a. Tiered. The discounted monthly rates for customers with electrical durable medical equipment and medical needs requiring air conditioning shall be the sum of the following charges, applied to all meter readings on or after January 1, 2018, through September 30, 2018: a. Fixed Charge Per account $5.79 $5.81 b. Distribution facilities charge Per kWh $0.0256 $0.0257 c. Energy and demand charge 1. Summer. For billings based on meter readings Dduring the summer season billing months of June, July and August, with the summer season billing month determined by the month the meter is read, and provided that no customer shall be billed more than three (3) full billing cycles at the summer rate. (a) Tier 1 - for the first five hundred (500) kilowatt hours per month Per kWh $0.0229 $0.0234 -8- (b) Tier 2 - for the next five hundred (500) kilowatt hours per month (c) Tier 3 - for all additional kilowatt hours per month Per kWh $0.0292 $0.0298 Per kWh $0.1150 $0.1173 2. Non-summer. For billings based on meter readings Dduring the non-summer season billing months of January through May and September through December. (a) Tier 1 - for the first five hundred (500) kilowatt hours per month, per kWh (b) Tier 2 - for the next five hundred (500) kilowatt hours per month, per kWh (c) Tier 3 - for all additional kilowatt hours per month, per kWh Per kWh $0.0318 $0.0325 Per kWh $0.0625 $0.0638 Per kWh $0.0719 $0.0733 d. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent b. Time-of-use. The discounted monthly rates for customers with electrical durable medical equipment and medical needs requiring air conditioning shall be the sum of the following charges, applied to all meter readings on or after October 1, 2018: a. Fixed Charge Per account $5.81 b. Distribution facilities charge Per kWh $0.0197 c. Energy and demand charge 5. Summer. For billings based on consumption during the months of May, June, July, August, and September (g) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) (h) Off-Peak Per kWh $0.0428 Per kWh $0.0300 6. Non-summer. For billings based on consumption during the months of January through April and October through December. (g) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) (h) Off-Peak Per kWh $0.1252 Per kWh $0.0288 d. Energy efficiency tier charge, per kilowatt hour for total consumption over 700 kWh in a billing month (regardless of on- peak or off-peak) Per kWh $0.0166 e. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent . . . -9- (f) Excess capacity charge. The monthly capacity charge kilowatt set forth in this Subsection (f) may be added to the above charges for service to intermittent loads in accordance with the provisions of the Electric Service Standards. Per kW $2.09 $2.10 . . . (p) Net metering. … (5) a. Tiered. The customer-generator's consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy consumed from the utility consumed by the customer-generator shall be billed at the applicable seasonal tiered rate as outlined in Subsection (c) of this Section. The energy produced by the customer- generator shall be credited to the customer monthly as follows, applied to all meter readings on or after January 1, 2018, through September 30, 2018: a. Distribution facilities credit Per kWh $0.0256 $0.0257 b. Energy and demand credit Per kWh $0.0634 $0.0647 b. Time-of-use. For customer-generators on a "time-of-use" (TOU) rate, consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy from the utility consumed by the customer-generator shall be billed at the applicable rates under Subsection (c) of this Section. The energy produced by the customer- generator shall be credited to the customer monthly as follows, applied to all meter readings on or after October 1, 2018: a. Distribution facilities credit Per kWh $0.0197 b. Energy and demand credit – For billings based on generation during the months of May, June, July, August and September 1. On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) Per kWh $0.2015 2. Off-Peak Per kWh $0.0428 Energy and demand credit – For billings based on generation during the months of January through April and October through December -10- 1. On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) Per kWh $0.1788 2. Off-Peak Per kWh $0.0411 . . . (r) Net metering—community solar projects. . . . (3) a. Tiered. Both the customer’s consumption of energy from Fort Collins Utilities and interest in the production of energy that flows into Fort Collins Utilities' distribution system shall be measured on a monthly basis. The energy consumed from Fort Collins Utilities consumed by the customer shall be billed at the applicable seasonal tiered rate as outlined in Subsections (c) and (d) of this Section. The method used to measure energy produced and issue credits under this Section shall be the same for subscriber-owned facilities and dedicated program-managed facilities. The energy produced by the customer's portion of the qualifying facility shall be credited to the customer monthly as follows, applied to all meter readings on or after January 1, 2018, through September 30, 2018: 1. Distribution facilities credit Per kWh $0.0128 2. Energy and demand credit Per kWh $0.0634 $0.0647 b. Time-of-use. For customer-generators on a "time-of-use" (TOU) rate, the customer’s consumption of energy from Fort Collins Utilities and interest in the production of energy that flows into Fort Collins Utilities' distribution system shall be measured on a monthly basis. The energy from the utility consumed by the customer-generator shall be billed at the applicable rates under Subsection (c) of this Section. The method used to measure energy produced and issue credits under this Section shall be identical for customers participating in third-party administered and City low-income community solar projects. The energy produced by the customer-generator shall be credited to the customer monthly as follows, applied to all meter readings on or after October 1, 2018: a. Distribution facilities credit Per kWh $0.0099 b. Energy and demand credit – For billings based on generation during the months of May, June, July, August and September 1) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) Per kWh $0.2015 2) Off-Peak Per kWh $0.0428 -11- Energy and demand credit – For billings based on generation during the months of January through April and October through December 1) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) Per kWh $0.1788 2) Off-Peak Per kWh $0.0411 (s) Time of Use (TOU) Pilot Study. (1) Objective. The City has identified potential benefits available through time-of- use (TOU) based electric service rates, including encouraging reduced energy consumption and equitably shifting energy costs to customers who use more energy. In order to study these benefits, Fort Collins Utilities shall conduct a temporary pilot project beginning with the billing cycle commencing on or after October 1, 2015, and concluding after twelve (12) full billing cycles. (2) Scope. The project shall include six thousand (6,000) residential energy service (Schedule R) customers selected at random. Customers selected at random will be notified and given a one-time opportunity to "opt-out" of participation in the project. Customers who do not opt-out will be assigned, as determined by the Executive Director, to one (1) of the two (2) pilot rates described in Subsections (s)(4) (pilot TOU rate) and (s)(5) (pilot TOU with energy efficiency tier rate), or monitored on their existing residential energy service tiered rate, as a control group. (3) Best-bill guarantee. Customers participating in the pilot project for the full twelve (12) billing cycle period will be eligible for the following best-bill guarantee: the total energy costs paid by each customer under either of the pilot rates for the twelve (12) full billing cycles shall be compared with the energy costs such customer would have paid under the base residential energy service tiered rate during the same twelve (12) billing cycles, and each customer shall be reimbursed (by issuance of a billing credit or otherwise, as determined by the Executive Director) for the amount by which the total energy costs paid exceed the amount that would have been due under the base residential energy service tiered rate for such period. Each customer who pays total energy costs under either of the pilot rates during the twelve (12) full billing cycles of the project that are less than the energy costs such customer would have paid under the base residential energy service tiered rate shall retain those savings. (4) Pilot TOU rate. Customers assigned to this rate during the pilot study shall pay monthly rates under this sub-schedule equal to the sum of the following charges: a. Fixed Charge Per account $5.07 b. Distribution facilities charge Per kWh $0.0238 c. Energy and demand charge 1. Summer. During the summer season billing months of May, June, July, August, and September -12- (i) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) (j) Off-Peak Per kWh $0.1968 Per kWh $0.0412 2. Non-summer. During the non-summer season billing months of January through April and October through December. (i) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) (j) Off-Peak Per kWh $0.1632 Per kWh $0.0395 d. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent (5) Pilot TOU with energy efficiency tier rate. Customers assigned to this rate during the pilot Study shall pay monthly rates under this sub-schedule equal to the sum of the following charges: a. Fixed Charge Per account $5.07 b. Distribution facilities charge Per kWh $0.0238 c. Energy and demand charge 1. Summer. During the summer season billing months of May, June, July, August, and September (k) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) (l) Off-Peak Per kWh $0.1968 Per kWh $0.0412 2. Non-summer. During the non-summer season billing months of January through April and October through December. (k) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) (l) Off-Peak Per kWh $0.1632 Per kWh $0.0395 d. Energy efficiency tier charge, per kilowatt hour for total consumption over 700 kWh in a billing month (regardless of on- peak or off-peak) Per kWh $0.0163 e. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent Section 3. That Sections 26-465 (c), (e) (f), (q), and (r) of the Code of the City of Fort Collins are hereby amended to read as follows: Sec. 26-465. Residential demand service, schedule RD. -13- . . . (c) Monthly rate. The monthly rates shall be the sum of the following charges, applied to all meter readings on or after January 1, 2018, through September 30, 2018, for all meter readings thereafter the charges shall be those set forth at Section 26-464(c)(2): (1) Fixed Charge Per account $5.79 $5.81 (2) Demand charge Per kW $2.44 $2.45 (3) Distribution facilities charge Per kWh $0.0228 $0.0229 (4) Energy charge a. Summer. For billings based on meter readings in the season billing months of June, July and August b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kWh $0.0443 $0.0452 Per kWh $0.0425 $0.0434 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. (5) Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent (e) Excess capacity charge. The monthly capacity charge kilowatt set forth in this Subsection (e) may be added to the above charges for service to intermittent loads in accordance with the provisions of the Electric Service Standards. Per kW $2.09 $2.10 (f) Standby service charges. Standby service, if available, will be provided on an annual contract basis at a level at least sufficient to meet probable service demand (in kilowatts) as determined by the customer and approved by the utility according to the following: (1) Monthly standby distribution charge: . . . Contracted standby service, this charge shall be in lieu of the distribution facilities charge. Per kW $2.11 $2.12 For all metered kilowatts in excess of the contracted amount Per kW $6.33 $6.35 -14- (q) Net metering. . . . (5) The customer-generator's consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy consumed from the utility consumed by the customer-generator shall be billed at the applicable seasonal tiered rate as outlined in Subsection (c) of this Section. The energy produced by the customer- generator shall be credited to the customer monthly as follows, applied to all meter readings on or after January 1, 2018, through September 30, 2018, for all meter readings thereafter the charges shall be those set forth at Section 26-464(p)(5)b: a. Distribution facilities credit Per kWh $0.0256 $0.0257 b. Energy and demand credit Per kWh $0.0634 $0.0647 (r) Net metering-community solar projects. . . . (3) Both the customer's consumption of energy from Fort Collins Utilities and interest in the production of energy that flows into Fort Collins Utilities' distribution system shall be measured on a monthly basis. The energy consumed from Fort Collins Utilities consumed by the customer shall be billed at the applicable seasonal tiered rate as outlined in Subsection (c) and (d) of this Section. The method used to measure energy produced and issue credits under this Section shall be the same for subscriber-owned facilities and dedicated program-managed facilities. The energy produced by the customer's portion of the qualifying facility shall be credited to the customer monthly as follows, applied to all meter readings on or after January 1, 2018, through September 30, 2018, for all meter readings thereafter the charges shall be those set forth at Section 26-464(r)(3)b.: 1. Distribution facilities credit Per kWh $0.0128 2. Energy and demand credit Per kWh $0.0634 $0.0647 Section 5. That Sections 26-466 (c), (e), (q), and (r) of the Code of the City of Fort Collins are hereby amended to read as follows: Sec. 26-466. General service, schedule GS. -15- . . . (c) Monthly rate. The monthly rates for this schedule shall be the sum of the following charges: 1. Fixed Charge a. Single-phase, two-hundred-ampere service Per account $3.60 $3.61 b. Single-phase, above two-hundred-ampere service Per account $10.61 $10.65 c. Three-phase, two-hundred-ampere service Per account $5.48 $5.50 d. Three-phase, above two-hundred-ampere service Per account $12.98 $13.03 2. Demand charge a. Summer. For billings based on meter readings in the season billing months of June, July, and August Per kWh $0.0268 $0.0273 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kWh $0.0164 $0.0167 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. 3. Distribution facilities charge Per kWh $0.0244 $0.0245 4. Energy charge a. Summer. For billings based on meter readings in the season billing months of June, July, and August Per kWh $0.0443 $0.0452 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kWh $0.0425 $0.0434 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. 5. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent -16- (e) Excess capacity charge. The monthly capacity charge per kilowatt set forth in this Subsection (e) may be added to the above charges for service to intermittent loads in accordance with the provisions of the Electric Service Standards. Per kW $2.09 $2.10 . . . (q) Net metering. . . . (5) The customer-generator's consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy consumed from the utility consumed by the customer-generator shall be billed at the applicable rate as outlined in Subsection (c) of this Section. The energy produced by the customer-generator shall be credited to the customer monthly as follows: a. Summer season eEnergy credit for billings based on generation during the months of June, July and August Per kWh $0.0443 $0.0452 (r) Net metering-community solar projects. . . . (3) Both the customer's consumption of energy from Fort Collins Utilities and interest in the production of energy that flows into Fort Collins Utilities' distribution system shall be measured on a monthly basis. The energy consumed from Fort Collins Utilities consumed by the customer shall be billed at the applicable seasonal tiered rate as outlined in Subsection (c) of this Section. The energy produced by the customer's portion of the qualifying facility shall be credited to the customer monthly as follows: 1. Distribution facilities credit Per kWh $0.0122 2. Energy and demand credit Per kWh $0.0443 $0.0452 . . . Section 6. That Sections 26-467 (c), (e), (f) and (r) of the Code of the City of Fort Collins are hereby amended to read as follows: Sec. 26-467. General service 25, schedule GS25. -17- . . . (c) Monthly rate. The monthly rates for this schedule shall be the sum of the following charges: 1. Fixed Charge a. Single-phase, two-hundred-ampere service Per account $3.60 $3.61 b. Single-phase, above two-hundred-ampere service Per account $10.61 $10.65 c. Three-phase, two-hundred-ampere service Per account $5.48 $5.50 d. Three-phase, above two-hundred-ampere service Per account $12.98 $13.03 2. Demand charge a. Summer. For billings based on meter readings in the season billing months of June, July, and August Per kW $8.28 $8.31 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kW $4.74 $4.76 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. 3. Distribution facilities charge Per kwh $0.0185 $0.0186 4. Energy charge a. Summer. For billings based on meter readings in the season billing months of June, July, and August Per kWh $0.0443 $0.0452 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kWh $0.0425 $0.0434 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. 5. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent ... -18- (e) Excess capacity charge. The monthly capacity charge kilowatt set forth in this Subsection (e) may be added to the above charges for service to intermittent loads in accordance with the provisions of the Electric Service Standards. Per kW $2.09 $2.10 (f) Standby service charges. Standby service, if available, will be provided on an annual contract basis at a level at least sufficient to meet probable service demand (in kilowatts) as determined by the customer and approved by the utility according to the following: (1) Monthly standby distribution charge Contracted standby service, this charge shall be in lieu of the distribution facilities charge. Per kW $3.83 $3.84 For all metered kilowatts in excess of the contracted amount Per kW $11.50 $11.54 . . . (r) Net metering. . . . (5) The customer-generator's consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy consumed from the utility consumed by the customer-generator shall be billed at the applicable rate as outlined in Subsection (c) of this Section. The energy produced by the customer-generator shall be credited to the customer monthly as follows: a. Summer season eEnergy credit for billings based on generation during the months of June, July and August Per kWh $0.0443 $0.0452 . . . Section 7. That Sections 26-468 (c), (e) through (g), and (u) of the Code of the City of Fort Collins are hereby amended to read as follows: Sec. 26-468. General service 50, schedule GS50. . . . -19- (c) Monthly rate. The monthly rates for this schedule shall be the sum of the following charges: (1) Fixed Charge Per account $9.08 $9.11 An additional charge may be assessed if telephone communication service is not provided by the customer. Per account $40.00 $40.14 (1) (2) Coincident demand charge a. Ssummer. For billings based on meter readings in the season billing months of June, July and August Per kW $11.68 $11.91 b. Nnon-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kW $8.90 $9.08 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. (3) Distribution facilities charge Per kW $6.25 $6.27 (4) Energy charge a. Summer. For billings based on meter readings in the season billing months of June, July, and August Per kWh $0.0443 $0.0452 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kWh $0.0425 $0.0434 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. (5) Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent (e) Excess capacity charge. The monthly capacity charge per kilowatt set forth in this Subsection (e) may be added to the above charges for service to intermittent loads in accordance with the provisions of the Electric Service Standards. Per kW $2.09 $2.10 (f) Standby service charges. Standby service, if available, will be provided on an annual contract basis at a level at least sufficient to meet probable service demand (in -20- kilowatts) as determined by the customer and approved by the utility according to the following: (1) Standby distribution charge. a. Monthly standby distribution charge shall be the sum of the following charges: Contracted standby service, this charge shall be in lieu of the distribution facilities charge. Per kW $4.92 $4.94 For all metered kilowatts in excess of the contracted amount Per kW $14.77 $14.82 . . . (g) Excess circuit charge. In the event a utility customer in this rate class desires excess circuit capacity for the purpose of controlling the available electric capacity of a backup circuit connection, this service, if available, will be provided on an annual contract basis at a level at least sufficient to meet probable backup demand (in kilowatts) as determined by the customer and approved by the utility according to the following: (1) Monthly charge shall be the sum of the following charges: Contracted backup capacity per month Per kW $1.01 Metered kilowatts in excess of the contracted amount Per kW $3.03 $3.04 (2) In the event the contractual kilowatt limit is exceeded, a new annual contract period will automatically begin as of the month the limit is exceeded. The metered demand in the month of exceedance shall become the minimum contracted demand level for the excess circuit charge. . . . (u) Net metering. . . . (5) The customer-generator's consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy consumed from the utility consumed by the customer-generator shall be billed at the applicable rate as outlined in Subsection (c) of this Section. The energy produced by the customer-generator shall be credited to the customer monthly as follows: a. Summer season eEnergy credit for billings based on generation during the months of June, July and August Per kWh $0.0443 $0.0452 -21- Section 8. That Sections 26-469 (c), (e) through (g) and (v) of the Code of the City of Fort Collins are hereby amended to read as follows: Sec. 26-469. General service 750, schedule GS750. . . . (c) Monthly rate. The monthly rates for this schedule shall be the sum of the following charges: (1) Fixed Charge Per account $15.56 $15.62 a. Additional charge for each additional metering point Per account $9.50 $9.53 b. An additional charge may be assessed if telephone communication service is not provided by the customer. Per account $40.00 $40.14 (2) Coincident demand charge a. Ssummer. For billings based on meter readings in the season billing months of June, July and August Per kW $11.51 $11.74 b. Nnon-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kW $8.77 $8.95 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. (3) Distribution facilities charge a. First seven hundred fifty (750) kilowatts Per kW $6.00 $6.02 b. All additional kilowatts Per kW $3.55 $3.56 (4) Energy charge a. Summer. For billings based on meter readings in the season billing months of June, July, and August Per kWh $0.0436 $0.0445 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kWh $0.0419 $0.0427 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. -22- (5) Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent (e) Excess capacity charge. The monthly capacity charge per kilowatt set forth in this Subsection (e) may be added to the above charges for service to intermittent loads in accordance with the provisions of the Electric Service Standards. Per kW $2.09 $2.10 (f) Standby service charges. Standby service, if available, will be provided on an annual contract basis at a level at least sufficient to meet probable service demand (in kilowatts) as determined by the customer and approved by the utility according to the following: (1) Standby distribution charge. a. Monthly standby distribution charges shall be paid in the following amounts Contracted standby service, this charge shall be in lieu of the distribution facilities charge. Per kW $3.41 $3.42 For all metered kilowatts in excess of the contracted amount Per kW $10.24 $10.28 . . . (g) Excess circuit charge. In the event a utility customer in this rate class desires excess circuit capacity for the purpose of controlling the available electric capacity of a backup circuit connection, this service, if available, will be provided on an annual contract basis at a level at least sufficient to meet probable backup demand (in kilowatts) as determined by the customer and approved by the utility at the following: (1) Monthly charge. . . . Contracted backup capacity per month Per kW $0.70 Metered kilowatts in excess of the contracted amount Per kW $2.10 $2.11 -23- (v) Net metering. . . . (5) The customer-generator's consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy consumed from the utility consumed by the customer-generator shall be billed at the applicable rate as outlined in Subsection (c) of this Section. The energy produced by the customer-generator shall be credited to the customer monthly as follows: a. Summer season eEnergy credit for billings based on generation during the months of June, July and August Per kWh $0.0436 $0.0445 Section 9. That Sections 26-470 (c), (e), and (s) of the Code of the City of Fort Collins are hereby amended to read as follows: Sec. 26-470. Substation service, schedule SS. . . . (c) Monthly rate. The monthly rates for this schedule shall be the sum of the following charges: (1) Fixed Charge Per account $35.38 $35.51 (2) Coincident demand charge a. Summer. For billings based on meter readings in the season billing months of June, July and August Per kW $11.33 $11.56 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kW $8.64 $8.81 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. (3) Distribution facilities charge Per kW $2.87 $2.88 (4) Energy charge a. Summer. For billings based on meter readings in the season billing months of June, July, and August Per kWh $0.0430 $0.0439 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kWh $0.0412 $0.0420 -24- c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. (5) Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent (e) Standby service charges. Standby service, if available, will be provided on an annual contract basis at a level at least sufficient to meet probable service demand (in kilowatts) as determined by the customer and approved by the utility at the following rates: (1) Standby distribution charge. a. Monthly standby distribution charge: Contracted standby service, this charge shall be in lieu of the distribution facilities charge. Per kW $2.55 $2.56 For all metered kilowatts in excess of the contracted amount Per kW $7.65 $7.68 . . . (s) Net metering. . . . (5) The customer-generator's consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy consumed from the utility consumed by the customer-generator shall be billed at the applicable rate as outlined in Subsection (c) of this Section. The energy produced by the customer-generator shall be credited to the customer monthly as follows: a. Summer season eEnergy credit for billings based on generation during the months of June, July and August Per kWh $0.0430 $0.0439 Section 10. That customers on the Residential Demand (RD) rate schedule under Section 26-465 as of September 30, 2018, shall be moved to the Residential (R) rate schedule under Section 26-464 of the Code of the City of Fort Collins, effective for all metering readings on or after October 1, 2018. Section 11. That, effective October 1, 2018, Section 26-465 of the Code of the City of Fort Collins is hereby repealed in whole and the section number reserved for future use. Section 12. That the amendments herein are effective and shall go into effect as follows: -25- a. Amended commercial schedule tiered rates (GS, GS25, GS50, GS750 & SS) shall apply to all electricity used on or after January 1, 2018; b. Amended schedules of tiered rates for all other rate classes shall apply to all bills issued on the basis of meter readings on or after January 1, 2018; c. Schedules of residential TOU rates shall apply to all bills issued on the basis of meter readings on or after October 1, 2018. Introduced, considered favorably on first reading, and ordered published this 7th day of November, A.D. 2017, and to be presented for final passage on the 21st day of November, A.D. 2017. __________________________________ Mayor ATTEST: _______________________________ City Clerk Passed and adopted on final reading on the 21st day of November, A.D. 2017. __________________________________ Mayor ATTEST: _______________________________ City Clerk -1- OPTION 3 ORDINANCE NO. 155, 2017 OF THE COUNCIL OF THE CITY OF FORT COLLINS AMENDING CHAPTER 26 OF THE CODE OF THE CITY OF FORT COLLINS TO REVISE ELECTRIC RATES, FEES, AND CHARGES AND UPDATING RELATED PROVISIONS WHEREAS, the City Council is empowered and directed by Article XII, Section 6, of the City Charter to fix, establish, maintain and provide for the collection of such rates, fees or charges for utility services furnished by the City as will produce revenues sufficient to pay the costs, expenses and other obligations of the electric utility, as set forth therein; and WHEREAS, the rates, fees or charges for utility services set forth herein are necessary to produce sufficient revenues to provide the utility services described herein; and WHEREAS, the revenue from the rates, fees or charges for utility services set forth herein shall be used to defray the costs of providing such utility services as required by the Charter and the City Code; and WHEREAS, the City purchases bulk wholesale electric power from Platte River Power Authority (“PRPA”) pursuant to an Amended Contract for Supply of Electric Power and Energy, dated September 1, 2010; and WHEREAS, PRPA costs are increasing due to reduced wholesale market prices and surplus sales, increased costs for coal, and increased operating costs for aging plants; and WHEREAS, PRPA will increase the City’s wholesale cost of power approximately 2.0% in 2018; and WHEREAS, the increased wholesale power cost will require an average 1.4% retail rate increase and increased local distribution costs will require an additional average 0.4% rate increase, for a total City retail electric rate increase in 2018 of 1.8% in order to remain consistent with Article XII, Section 6, of the City Charter; and WHEREAS, the proposed rate increase will vary based on the cost of service to each customer class; and WHEREAS, since 2012, residential customers have been billed under “tier” based electric rates, where tier 1 consumption is lower than the cost-of-service and a progressively higher step charge per kWh is applied for tier 2 and tier 3 consumption, in an effort to encourage energy conservation and efficiency in the rate class; and WHEREAS, as presented at the July 11, 2017, City Council work session, staff has identified benefits available through “time-of-use” (“TOU”) based residential electric rates, compared to tiered electric rates, including aligning retail pricing with PRPA’s wholesale power costs paid by the City for total system consumption; and -2- WHEREAS, adopting residential TOU rates will also enable the City to better leverage incentives in electric rates to encourage energy conservation and efficiency, and equitably shift energy costs to residential customers who use more energy; and WHEREAS, based on direction provided by the City Council on July 11, 2017, staff developed optimal rates, fees and charges for TOU residential electric services, as further set forth herein and as necessary to produce sufficient revenues to provide the utility services described herein; and WHEREAS, staff’s TOU rate recommendations include updating the Residential Demand (“RD”) rate for all-electric heat customers, effective for all billings issued with meter readings on or after October 1, 2018, in order to equalize the conservation incentives of TOU rates for all residential customers and avoid potentially penalizing low-income or net-metered customers; and WHEREAS, in addition to adjusting the electric rates, Utilities staff has identified formatting and maintenance updates to Chapter 26 of the City Code necessary to improve the clarity with which electric rates are stated; and WHEREAS, the Energy Board considered the proposed TOU electric rates at its March 9, 2017, and May 11, 2017 regular meetings, and the proposed tiered rates, fees, and charges, and language clarifications for 2018 at its October 12, 2017, regular meeting, and provided recommendations of approval of both rate sets to City Council; and WHEREAS, the City Manager and staff have recommended to the City Council the following electric rate adjustments and City Code rate language clarifications for all electricity used by GS50 and GS750 rate class customers on or after January 1, 2018, and for all other customer classes for all billings issued with meter readings on or after January 1, 2018; and WHEREAS, with regard to residential customers, the City Manager and staff further recommend to the City Council the following TOU electric rate adjustments and City Code rate language clarifications to transition such customers from tiered rates, which new rates will go into effect for all billings issued with meter readings on or after October 1, 2018; and WHEREAS, the City Manager and staff have recommended that the residential tiered rates described in this Ordinance remain in effect from January 1, 2018, until September 30, 2018, and that TOU-based rates go into effect for all residential rate class billings issued on meter readings on or after October 1, 2018; and WHEREAS, based on the foregoing, it is the desire of the City Council to amend Chapter 26 of the City Code to revise the electric rates, fees and charges. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: -3- Section 1. That the City Council hereby makes and adopts the determinations and findings contained in the recitals set forth above. Section 2. That Sections 26-391 of the Code of the City of Fort Collins is hereby amended by the addition of a new definition to read as follows: Holiday shall mean the twenty-four (24) hour calendar day for each of the following: New Year’s Day, Memorial Day, July 4th, Labor Day, Thanksgiving Day, and Christmas. Section 3. That Sections 26-464 (c), (d), (f), (p), (r) and (s) of the Code of the City of Fort Collins are hereby amended to read as follows: Sec. 26-464. Residential energy service, schedule R. . . . (c) Monthly rate. (1) Tiered. The monthly rates for this schedule shall be the sum of the following charges, applied to all meter readings on or after January 1, 2018, through September 30, 2018: (1) Fixed Charge Per account $5.79 $5.81 (2) Distribution facilities charge Per kWh $0.0256 $0.0257 (3) Energy and demand charge a. Summer. For billings based on meter readings Dduring the summer season billing months of June, July and August, with the summer season billing month determined by the month the meter is read, and provided that no customer shall be billed more than three (3) full billing cycles at the summer rate. 1. Tier 1 - for the first five hundred (500) kilowatt hours per month 2. Tier 2 - for the next five hundred (500) kilowatt hours per month 3. Tier 3 - for all additional kilowatt hours per month Per kWh $0.0634 $0.0647 Per kWh $0.0807 $0.0823 Per kWh $0.1150 $0.1173 b. Non-summer. For billings based on meter readings Dduring the non-summer season billing months of January through May and September through December. 1. Tier 1 - for the first five hundred (500) kilowatt hours per month, per kWh 2. Tier 2 - for the next five hundred (500) kilowatt hours per month, per kWh Per kWh $0.0583 $0.0595 Per kWh $0.0625 $0.0638 -4- 3. Tier 3 - for all additional kilowatt hours per month, per kWh Per kWh $0.0719 $0.0729 (4) Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent (2) Time-of-use. The monthly rates for this schedule shall be the sum of the following charges, applied to all meter readings on or after October 1, 2018: a. Fixed Charge Per account $5.81 b. Distribution facilities charge Per kWh $0.0197 c. Energy and demand charge 1. Summer. For billings based on consumption during the months of May, June, July, August, and September (a) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) (b) Off-Peak Per kWh $0.2015 Per kWh $0.0428 2. Non-summer. For billings based on consumption during the months of January through April and October through December. (a) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) (b) Off-Peak Per kWh $0.1788 Per kWh $0.0411 d. Energy efficiency tier charge, per kilowatt hour for total consumption over 700 kWh in a billing month (regardless of on-peak or off-peak) Per kWh $0.0166 e. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent (d) Medical assistance program. . . . (3) a. Tiered. The discounted monthly rates for customers with electrical durable medical equipment only shall be the sum of the following charges, applied to all meter readings on or after January 1, 2018, through September 30, 2018: a. Fixed Charge Per account $5.79 $5.81 b. Distribution facilities charge Per kWh $0.0256 $0.0257 -5- c. Energy and demand charge 1. Summer. For billings based on meter readings Dduring the summer season billing months of June, July and August, with the summer season billing month determined by the month the meter is read, and provided that no customer shall be billed more than three (3) full billing cycles at the summer rate. (a) Tier 1 - for the first five hundred (500) kilowatt hours per month (b) Tier 2 - for the next five hundred (500) kilowatt hours per month (c) Tier 3 - for all additional kilowatt hours per month Per kWh $0.0358 $0.0363 Per kWh $0.0807 $0.0823 Per kWh $0.1150 $0.1173 2. Non-summer. For billings based on meter readings Dduring the non-summer season billing months of January through May and September through December. (a) Tier 1 - for the first five hundred (500) kilowatt hours per month, per kWh (b) Tier 2 - for the next five hundred (500) kilowatt hours per month, per kWh (c) Tier 3 - for all additional kilowatt hours per month, per kWh Per kWh $0.0318 $0.0325 Per kWh $0.0625 $0.0638 Per kWh $0.0719 $0.0733 d. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent b. Time-of-use. The discounted monthly rates for customers with electrical durable medical equipment only shall be the sum of the following charges, applied to all meter readings on or after October 1, 2018: a. Fixed Charge Per account $5.81 b. Distribution facilities charge Per kWh $0.0197 c. Energy and demand charge 1. Summer. For billings based on consumption during the months of May, June, July, August, and September (c) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) (d) Off-Peak Per kWh $0.1411 Per kWh $0.0300 2. Non-summer. For billings based on consumption during the months of January through April and October through December. (c) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) (d) Off-Peak Per kWh $0.1252 Per kWh $0.0288 -6- d. Energy efficiency tier charge, per kilowatt hour for total consumption over 700 kWh in a billing month (regardless of on- peak or off-peak) Per kWh $0.0166 e. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 Percent (4) a. Tiered. The discounted monthly rates for customers with medical needs requiring air conditioning only shall be the sum of the following charges, applied to all meter readings on or after January 1, 2018, through September 30, 2018: a. Fixed Charge Per account $5.79 $5.81 b. Distribution facilities charge Per kWh $0.0256 $0.0257 c. Energy and demand charge 1. Summer. For billings based on meter readings Dduring the summer season billing months of June, July and August, with the summer season billing month determined by the month the meter is read, and provided that no customer shall be billed more than three (3) full billing cycles at the summer rate. (a) Tier 1 - for the first five hundred (500) kilowatt hours per month (b) Tier 2 - for the next five hundred (500) kilowatt hours per month (c) Tier 3 - for all additional kilowatt hours per month Per kWh $0.0351 $0.0358 Per kWh $0.0446 $0.0454 Per kWh $0.1150 $0.1173 2. Non-summer. For billings based on meter readings Dduring the non-summer season billing months of January through May and September through December. (a) Tier 1 - for the first five hundred (500) kilowatt hours per month, per kWh (b) Tier 2 - for the next five hundred (500) kilowatt hours per month, per kWh (c) Tier 3 - for all additional kilowatt hours per month, per kWh Per kWh $0.0583 $0.0595 Per kWh $0.0625 $0.0638 Per kWh $0.0719 $0.0733 d. Payment in lieu of taxes (PILOT) and franchise. A charge of all monthly service charges billed pursuant to this Section 6 percent b. Time-of-use. The discounted monthly rates for customers with medical needs requiring air conditioning only shall be the sum of the following charges, applied to all meter readings on or after October 1, 2018: -7- a. Fixed Charge Per account $5.81 b. Distribution facilities charge Per kWh $0.0197 c. Energy and demand charge 3. Summer. For billings based on consumption during the months of May, June, July, August, and September (e) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) (f) Off-Peak Per kWh $0.0428 Per kWh $0.0428 4. Non-summer. For billings based on consumption during the months of January through April and October through December. (e) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) (f) Off-Peak Per kWh $0.1788 Per kWh $0.0411 d. Energy efficiency tier charge, per kilowatt hour for total consumption over 700 kWh in a billing month (regardless of on- peak or off-peak) Per kWh $0.0166 e. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent (5) a. Tiered. The discounted monthly rates for customers with electrical durable medical equipment and medical needs requiring air conditioning shall be the sum of the following charges, applied to all meter readings on or after January 1, 2018, through September 30, 2018: a. Fixed Charge Per account $5.79 $5.81 b. Distribution facilities charge Per kWh $0.0256 $0.0257 c. Energy and demand charge 1. Summer. For billings based on meter readings Dduring the summer season billing months of June, July and August, with the summer season billing month determined by the month the meter is read, and provided that no customer shall be billed more than three (3) full billing cycles at the summer rate. (a) Tier 1 - for the first five hundred (500) kilowatt hours per month (b) Tier 2 - for the next five hundred (500) kilowatt hours per month (c) Tier 3 - for all additional kilowatt hours per month Per kWh $0.0229 $0.0234 Per kWh $0.0292 $0.0298 Per kWh $0.1150 $0.1173 -8- 2. Non-summer. For billings based on meter readings Dduring the non-summer season billing months of January through May and September through December. (a) Tier 1 - for the first five hundred (500) kilowatt hours per month, per kWh (b) Tier 2 - for the next five hundred (500) kilowatt hours per month, per kWh (c) Tier 3 - for all additional kilowatt hours per month, per kWh Per kWh $0.0318 $0.0325 Per kWh $0.0625 $0.0638 Per kWh $0.0719 $0.0733 d. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent b. Time-of-use. The discounted monthly rates for customers with electrical durable medical equipment and medical needs requiring air conditioning shall be the sum of the following charges, applied to all meter readings on or after October 1, 2018: a. Fixed Charge Per account $5.81 b. Distribution facilities charge Per kWh $0.0197 c. Energy and demand charge 5. Summer. For billings based on consumption during the months of May, June, July, August, and September (g) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) (h) Off-Peak Per kWh $0.0428 Per kWh $0.0300 6. Non-summer. For billings based on consumption during the months of January through April and October through December. (g) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) (h) Off-Peak Per kWh $0.1252 Per kWh $0.0288 d. Energy efficiency tier charge, per kilowatt hour for total consumption over 700 kWh in a billing month (regardless of on- peak or off-peak) Per kWh $0.0166 e. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent . . . (f) Excess capacity charge. The monthly capacity charge kilowatt set forth in this Subsection (f) may be added to the above charges for service to intermittent loads in accordance with the provisions of the Electric Service Standards. -9- Per kW $2.09 $2.10 . . . (p) Net metering. … (5) a. Tiered. The customer-generator's consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy consumed from the utility consumed by the customer-generator shall be billed at the applicable seasonal tiered rate as outlined in Subsection (c) of this Section. The energy produced by the customer- generator shall be credited to the customer monthly as follows, applied to all meter readings on or after January 1, 2018, through September 30, 2018: a. Distribution facilities credit Per kWh $0.0256 $0.0257 b. Energy and demand credit Per kWh $0.0634 $0.0647 b. Time-of-use. For customer-generators on a "time-of-use" (TOU) rate, consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy from the utility consumed by the customer-generator shall be billed at the applicable rates under Subsection (c) of this Section. The energy produced by the customer- generator shall be credited to the customer monthly as follows, applied to all meter readings on or after October 1, 2018: a. Distribution facilities credit Per kWh $0.0197 b. Energy and demand credit – For billings based on generation during the months of May, June, July, August and September 1. On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) Per kWh $0.2015 2. Off-Peak Per kWh $0.0428 Energy and demand credit – For billings based on generation during the months of January through April and October through December 1. On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) Per kWh $0.1788 2. Off-Peak Per kWh $0.0411 . . . -10- (r) Net metering—community solar projects. . . . (3) a. Tiered. Both the customer’s consumption of energy from Fort Collins Utilities and interest in the production of energy that flows into Fort Collins Utilities' distribution system shall be measured on a monthly basis. The energy consumed from Fort Collins Utilities consumed by the customer shall be billed at the applicable seasonal tiered rate as outlined in Subsections (c) and (d) of this Section. The method used to measure energy produced and issue credits under this Section shall be the same for subscriber-owned facilities and dedicated program-managed facilities. The energy produced by the customer's portion of the qualifying facility shall be credited to the customer monthly as follows, applied to all meter readings on or after January 1, 2018, through September 30, 2018: 1. Distribution facilities credit Per kWh $0.0128 2. Energy and demand credit Per kWh $0.0634 $0.0647 b. Time-of-use. For customer-generators on a "time-of-use" (TOU) rate, the customer’s consumption of energy from Fort Collins Utilities and interest in the production of energy that flows into Fort Collins Utilities' distribution system shall be measured on a monthly basis. The energy from the utility consumed by the customer-generator shall be billed at the applicable rates under Subsection (c) of this Section. The method used to measure energy produced and issue credits under this Section shall be the same for subscriber-owned facilities and dedicated program-managed facilities. The energy produced by the customer-generator shall be credited to the customer monthly as follows, applied to all meter readings on or after October 1, 2018: 1. Distribution facilities credit Per kWh $0.0099 2. Energy and demand credit – For billings based on generation during the months of May, June, July, August and September a) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) Per kWh $0.2015 b) Off-Peak Per kWh $0.0428 Energy and demand credit – For billings based on generation during the months of January through April and October through December a) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) Per kWh $0.1788 b) Off-Peak Per kWh $0.0411 -11- (s) Time of Use (TOU) Pilot Study. (1) Objective. The City has identified potential benefits available through time-of- use (TOU) based electric service rates, including encouraging reduced energy consumption and equitably shifting energy costs to customers who use more energy. In order to study these benefits, Fort Collins Utilities shall conduct a temporary pilot project beginning with the billing cycle commencing on or after October 1, 2015, and concluding after twelve (12) full billing cycles. (2) Scope. The project shall include six thousand (6,000) residential energy service (Schedule R) customers selected at random. Customers selected at random will be notified and given a one-time opportunity to "opt-out" of participation in the project. Customers who do not opt-out will be assigned, as determined by the Executive Director, to one (1) of the two (2) pilot rates described in Subsections (s)(4) (pilot TOU rate) and (s)(5) (pilot TOU with energy efficiency tier rate), or monitored on their existing residential energy service tiered rate, as a control group. (3) Best-bill guarantee. Customers participating in the pilot project for the full twelve (12) billing cycle period will be eligible for the following best-bill guarantee: the total energy costs paid by each customer under either of the pilot rates for the twelve (12) full billing cycles shall be compared with the energy costs such customer would have paid under the base residential energy service tiered rate during the same twelve (12) billing cycles, and each customer shall be reimbursed (by issuance of a billing credit or otherwise, as determined by the Executive Director) for the amount by which the total energy costs paid exceed the amount that would have been due under the base residential energy service tiered rate for such period. Each customer who pays total energy costs under either of the pilot rates during the twelve (12) full billing cycles of the project that are less than the energy costs such customer would have paid under the base residential energy service tiered rate shall retain those savings. (4) Pilot TOU rate. Customers assigned to this rate during the pilot study shall pay monthly rates under this sub-schedule equal to the sum of the following charges: a. Fixed Charge Per account $5.07 b. Distribution facilities charge Per kWh $0.0238 c. Energy and demand charge 1. Summer. During the summer season billing months of May, June, July, August, and September (i) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) (j) Off-Peak Per kWh $0.1968 Per kWh $0.0412 2. Non-summer. During the non-summer season billing months of January through April and October through December. -12- (i) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) (j) Off-Peak Per kWh $0.1632 Per kWh $0.0395 d. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent (5) Pilot TOU with energy efficiency tier rate. Customers assigned to this rate during the pilot Study shall pay monthly rates under this sub-schedule equal to the sum of the following charges: a. Fixed Charge Per account $5.07 b. Distribution facilities charge Per kWh $0.0238 c. Energy and demand charge 1. Summer. During the summer season billing months of May, June, July, August, and September (k) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) (l) Off-Peak Per kWh $0.1968 Per kWh $0.0412 2. Non-summer. During the non-summer season billing months of January through April and October through December. (k) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) (l) Off-Peak Per kWh $0.1632 Per kWh $0.0395 d. Energy efficiency tier charge, per kilowatt hour for total consumption over 700 kWh in a billing month (regardless of on- peak or off-peak) Per kWh $0.0163 e. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent Section 4. That Sections 26-465 (c), (e), (f), (q), and (r) of the Code of the City of Fort Collins are hereby amended to read as follows: Sec. 26-465. Residential demand service, schedule RD. . . . (c) Monthly rate. (1) The monthly rates shall be the sum of the following charges, applied to all meter readings on or after January 1, 2018, through September 30, 2018: -13- (1) Fixed Charge Per account $5.79 $5.81 (2) Demand charge Per kW $2.44 $2.45 (3) Distribution facilities charge Per kWh $0.0228 $0.0229 (4) Energy charge a. Summer. For billings based on meter readings in the season billing months of June, July and August b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kWh $0.0443 $0.0452 Per kWh $0.0425 $0.0434 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. (5) Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent (2) Time of use. The monthly rates for this schedule shall be the sum of the following charges, applied to all meter readings on or after October 1, 2018: a. Fixed Charge Per account $5.81 b. Distribution facilities charge Per kWh $0.0257 c. Energy and demand charge 1. Summer. For billings based on consumption during the months of May, June, July and August, and September (a) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) (b) Off-Peak Per kWh $0.2015 Per kWh $0.0428 2. Non-summer. For billings based on consumption during the months of January through April and October through December. (a) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) (b) Off-Peak Per kWh $0.1788 Per kWh $0.0411 d. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent ... -14- (e) Excess capacity charge. The monthly capacity charge kilowatt set forth in this Subsection (e) may be added to the above charges for service to intermittent loads in accordance with the provisions of the Electric Service Standards. Per kW $2.09 $2.10 (f) Standby service charges. Standby service, if available, will be provided on an annual contract basis at a level at least sufficient to meet probable service demand (in kilowatts) as determined by the customer and approved by the utility according to the following: (1) Monthly standby distribution charge: . . . (q) Net metering. . . . (5) a. The customer-generator's consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy consumed from the utility consumed by the customer- generator shall be billed at the applicable seasonal tiered rate as outlined in Subsection (c) of this Section. The energy produced by the customer-generator shall be credited to the customer monthly as follows, applied to all meter readings on or after January 1, 2018, through September 30, 2018: (1) Distribution facilities credit Per kWh $0.0256 $0.0257 (2) Energy and demand credit Per kWh $0.0634 $0.0647 b. Time-of-use. For customer-generators on a "time-of-use" (TOU) rate, consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy from the utility consumed by the customer-generator shall be billed at the applicable rates under Subsection (c) of this Section. The energy produced by the customer- Contracted standby service, this charge shall be in lieu of the distribution facilities charge. Per kW $2.11 $2.12 For all metered kilowatts in excess of the contracted amount Per kW $6.33 $6.35 -15- generator shall be credited to the customer monthly as follows, applied to all meter readings on or after October 1, 2018: (1) Distribution facilities credit Per kWh $0.0257 (2) Energy and demand credit – For billings based on generation during the months of May, June, July, August and September a) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) Per kWh $0.2015 b) Off-Peak Per kWh $0.0428 Energy and demand credit – For billings based on generation during the months of January through April and October through December a) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) Per kWh $0.1788 b) Off-Peak Per kWh $0.0411 (r) Net metering-community solar projects. . . . (3) a. Both the customer’s consumption of energy from Fort Collins Utilities and interest in the production of energy that flows into Fort Collins Utilities' distribution system shall be measured on a monthly basis. The energy consumed from Fort Collins Utilities consumed by the customer shall be billed at the applicable seasonal tiered rate as outlined in Subsections (c) and (d) of this Section. The method used to measure energy produced and issue credits under this Section shall be the same for subscriber-owned facilities and dedicated program-managed facilities. The energy produced by the customer's portion of the qualifying facility shall be credited to the customer monthly as follows, applied to all meter readings on or after January 1, 2018, through September 30, 2018: 1. Distribution facilities credit Per kWh $0.0128 2. Energy and demand credit Per kWh $0.0634 $0.0647 b. Time-of-use. For customer-generators on a "time-of-use" (TOU) rate, the customer’s consumption of energy from Fort Collins Utilities and interest in the production of energy that flows into Fort Collins Utilities' distribution system shall be measured on a monthly basis. The energy from the utility consumed by the customer-generator shall be billed at the applicable rates under Subsection (c) of this Section. The method used to measure energy produced and issue credits under this Section shall be the same for subscriber-owned facilities and dedicated program-managed facilities. The energy produced by the customer-generator shall be credited to the customer monthly as follows, applied to all meter readings on or after October 1, 2018: -16- 1. Distribution facilities credit Per kWh $0.0128 2. Energy and demand credit – For billings based on generation during the months of May, June, July, August and September a) On-Peak (Mon-Fri, 2 pm to 7 pm, excluding holidays) Per kWh $0.2015 b) Off-Peak Per kWh $0.0428 Energy and demand credit – For billings based on generation during the months of January through April and October through December a) On-Peak (Mon-Fri, 5 pm to 9 pm, excluding holidays) Per kWh $0.1788 b) Off-Peak Per kWh $0.0411 Section 5. That Sections 26-466 (c), (e), (q), and (r) of the Code of the City of Fort Collins are hereby amended to read as follows: Sec. 26-466. General service, schedule GS. . . . (c) Monthly rate. The monthly rates for this schedule shall be the sum of the following charges: 1. Fixed Charge a. Single-phase, two-hundred-ampere service Per account $3.60 $3.61 b. Single-phase, above two-hundred-ampere service Per account $10.61 $10.65 c. Three-phase, two-hundred-ampere service Per account $5.48 $5.50 d. Three-phase, above two-hundred-ampere service Per account $12.98 $13.03 2. Demand charge a. Summer. For billings based on meter readings in the season billing months of June, July, and August Per kWh $0.0268 $0.0273 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kWh $0.0164 $0.0167 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. 3. Distribution facilities charge Per kWh $0.0244 $0.0245 -17- 4. Energy charge a. Summer. For billings based on meter readings in the season billing months of June, July, and August Per kWh $0.0443 $0.0452 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kWh $0.0425 $0.0434 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. 5. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent ... (e) Excess capacity charge. The monthly capacity charge per kilowatt set forth in this Subsection (e) may be added to the above charges for service to intermittent loads in accordance with the provisions of the Electric Service Standards. Per kW $2.09 $2.10 . . . (q) Net metering. . . . (5) The customer-generator's consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy consumed from the utility consumed by the customer-generator shall be billed at the applicable rate as outlined in Subsection (c) of this Section. The energy produced by the customer-generator shall be credited to the customer monthly as follows: a. Summer season eEnergy credit for billings based on generation during the months of June, July and August Per kWh $0.0443 $0.0452 (r) Net metering-community solar projects. . . . (3) Both the customer's consumption of energy from Fort Collins Utilities and interest in the production of energy that flows into Fort Collins Utilities' distribution system shall be measured on a monthly basis. The energy consumed from Fort -18- Collins Utilities consumed by the customer shall be billed at the applicable seasonal tiered rate as outlined in Subsection (c) of this Section. The energy produced by the customer's portion of the qualifying facility shall be credited to the customer monthly as follows: 1. Distribution facilities credit Per kWh $0.0122 2. Energy and demand credit Per kWh $0.0443 $0.0452 Section 6. That Sections 26-467 (c), (e), (f) and (r) of the Code of the City of Fort Collins are hereby amended to read as follows: Sec. 26-467. General service 25, schedule GS25. . . . (c) Monthly rate. The monthly rates for this schedule shall be the sum of the following charges: 1. Fixed Charge a. Single-phase, two-hundred-ampere service Per account $3.60 $3.61 b. Single-phase, above two-hundred-ampere service Per account $10.61 $10.65 c. Three-phase, two-hundred-ampere service Per account $5.48 $5.50 d. Three-phase, above two-hundred-ampere service Per account $12.98 $13.03 2. Demand charge a. Summer. For billings based on meter readings in the season billing months of June, July, and August Per kW $8.28 $8.31 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kW $4.74 $4.76 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. 3. Distribution facilities charge Per kwh $0.0185 $0.0186 4. Energy charge -19- a. Summer. For billings based on meter readings in the season billing months of June, July, and August Per kWh $0.0443 $0.0452 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kWh $0.0425 $0.0434 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. 5. Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent ... (e) Excess capacity charge. The monthly capacity charge kilowatt set forth in this Subsection (e) may be added to the above charges for service to intermittent loads in accordance with the provisions of the Electric Service Standards. Per kW $2.09 $2.10 (f) Standby service charges. Standby service, if available, will be provided on an annual contract basis at a level at least sufficient to meet probable service demand (in kilowatts) as determined by the customer and approved by the utility according to the following: (1) Monthly standby distribution charge Contracted standby service, this charge shall be in lieu of the distribution facilities charge. Per kW $3.83 $3.84 For all metered kilowatts in excess of the contracted amount Per kW $11.50 $11.54 . . . (r) Net metering. . . . (5) The customer-generator's consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy consumed from the utility consumed by -20- the customer-generator shall be billed at the applicable rate as outlined in Subsection (c) of this Section. The energy produced by the customer-generator shall be credited to the customer monthly as follows: a. Summer season eEnergy credit for billings based on generation during the months of June, July and August Per kWh $0.0443 $0.0452 Section 7. That Sections 26-468 (c), (e) through (g), and (u) of the Code of the City of Fort Collins are hereby amended to read as follows: Sec. 26-468. General service 50, schedule GS50. . . . (c) Monthly rate. The monthly rates for this schedule shall be the sum of the following charges: (1) Fixed Charge Per account $9.08 $9.11 An additional charge may be assessed if telephone communication service is not provided by the customer. Per account $40.00 $40.14 (2) Coincident demand charge a. Summer. For billings based on meter readings in the season billing months of June, July and August Per kW $11.68 $11.91 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kW $8.90 $9.08 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. (3) Distribution facilities charge Per kW $6.25 $6.27 (4) Energy charge a. Summer. For billings based on meter readings in the season billing months of June, July, and August Per kWh $0.0443 $0.0452 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kWh $0.0425 $0.0434 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. (5) Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent -21- ... (e) Excess capacity charge. The monthly capacity charge per kilowatt set forth in this Subsection (e) may be added to the above charges for service to intermittent loads in accordance with the provisions of the Electric Service Standards. Per kW $2.09 $2.10 (f) Standby service charges. Standby service, if available, will be provided on an annual contract basis at a level at least sufficient to meet probable service demand (in kilowatts) as determined by the customer and approved by the utility according to the following: (1) Standby distribution charge. a. Monthly standby distribution charge shall be the sum of the following charges: Contracted standby service, this charge shall be in lieu of the distribution facilities charge. Per kW $4.92 $4.94 For all metered kilowatts in excess of the contracted amount Per kW $14.77 $14.82 . . . (g) Excess circuit charge. In the event a utility customer in this rate class desires excess circuit capacity for the purpose of controlling the available electric capacity of a backup circuit connection, this service, if available, will be provided on an annual contract basis at a level at least sufficient to meet probable backup demand (in kilowatts) as determined by the customer and approved by the utility according to the following: (1) Monthly charge shall be the sum of the following charges: Contracted backup capacity per month Per kW $1.01 Metered kilowatts in excess of the contracted amount Per kW $3.03 $3.04 (2) In the event the contractual kilowatt limit is exceeded, a new annual contract period will automatically begin as of the month the limit is exceeded. The metered demand in the month of exceedance shall become the minimum contracted demand level for the excess circuit charge. -22- . . . (u) Net metering. . . . (5) The customer-generator's consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy consumed from the utility consumed by the customer-generator shall be billed at the applicable rate as outlined in Subsection (c) of this Section. The energy produced by the customer-generator shall be credited to the customer monthly as follows: a. Summer season eEnergy credit for billings based on generation during the months of June, July and August Per kWh $0.0443 $0.0452 Section 8. That Sections 26-469 (c), (e) through (g) and (v) of the Code of the City of Fort Collins are hereby amended to read as follows: Sec. 26-469. General service 750, schedule GS750. . . . (c) Monthly rate. The monthly rates for this schedule shall be the sum of the following charges: (1) Fixed Charge Per account $15.56 $15.62 a. Additional charge for each additional metering point Per account $9.50 $9.53 b. An additional charge may be assessed if telephone communication service is not provided by the customer. Per account $40.00 $40.14 (2) Coincident demand charge a. Summer. For billings based on meter readings in the season billing months of June, July and August Per kW $11.51 $11.74 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kW $8.77 $8.95 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. (3) Distribution facilities charge -23- a. First seven hundred fifty (750) kilowatts Per kW $6.00 $6.02 b. All additional kilowatts Per kW $3.55 $3.56 (4) Energy charge a. Summer. For billings based on meter readings in the season billing months of June, July, and August Per kWh $0.0436 $0.0445 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kWh $0.0419 $0.0427 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. (5) Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent ... (e) Excess capacity charge. The monthly capacity charge per kilowatt set forth in this Subsection (e) may be added to the above charges for service to intermittent loads in accordance with the provisions of the Electric Service Standards. Per kW $2.09 $2.10 (f) Standby service charges. Standby service, if available, will be provided on an annual contract basis at a level at least sufficient to meet probable service demand (in kilowatts) as determined by the customer and approved by the utility according to the following: (1) Standby distribution charge. a. Monthly standby distribution charges shall be paid in the following amounts Contracted standby service, this charge shall be in lieu of the distribution facilities charge. Per kW $3.41 $3.42 For all metered kilowatts in excess of the contracted amount Per kW $10.24 $10.28 . . . -24- (g) Excess circuit charge. In the event a utility customer in this rate class desires excess circuit capacity for the purpose of controlling the available electric capacity of a backup circuit connection, this service, if available, will be provided on an annual contract basis at a level at least sufficient to meet probable backup demand (in kilowatts) as determined by the customer and approved by the utility at the following rates: (1) Monthly charge. . . . (v) Net metering. . . . (5) The customer-generator's consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy consumed from the utility consumed by the customer-generator shall be billed at the applicable rate as outlined in Subsection (c) of this Section. The energy produced by the customer-generator shall be credited to the customer monthly as follows: a. Summer season eEnergy credit for billings based on generation during the months of June, July and August Per kWh $0.0436 $0.0445 Section 9. That Sections 26-470 (c), (e), and (s) of the Code of the City of Fort Collins are hereby amended to read as follows: Sec. 26-470. Substation service, schedule SS. . . . (c) Monthly rate. The monthly rates for this schedule shall be the sum of the following charges: (1) Fixed Charge Per account $35.38 $35.51 (2) Coincident demand charge a. Summer. For billings based on meter readings in the season billing months of June, July and August Per kW $11.33 $11.56 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kW $8.64 $8.81 Contracted backup capacity per month Per kW $0.70 Metered kilowatts in excess of the contracted amount Per kW $2.10 $2.11 -25- c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. (3) Distribution facilities charge Per kW $2.87 $2.88 (4) Energy charge a. Summer. For billings based on meter readings in the season billing months of June, July, and August Per kWh $0.0430 $0.0439 b. Non-summer. For billings based on meter readings in the season billing months of January through May and September through December Per kWh $0.0412 $0.0420 c. The meter reading date shall generally determine the summer season billing months; however, no customer shall be billed more than three (3) full billing cycles at the summer rate. (5) Payment in lieu of taxes (PILOT) and franchise. A charge based on all monthly service charges billed pursuant to this Section 6 percent ... (e) Standby service charges. Standby service, if available, will be provided on an annual contract basis at a level at least sufficient to meet probable service demand (in kilowatts) as determined by the customer and approved by the utility at the following rates: (1) Standby distribution charge. a. Monthly standby distribution charge: Contracted standby service, this charge shall be in lieu of the distribution facilities charge. Per kW $2.55 $2.56 For all metered kilowatts in excess of the contracted amount Per kW $7.65 $7.68 . . . (s) Net metering. . . . (5) The customer-generator's consumption of energy from the utility and production of energy that flows into the utility's distribution system shall be measured on a monthly basis. The energy consumed from the utility consumed by -26- the customer-generator shall be billed at the applicable rate as outlined in Subsection (c) of this Section. The energy produced by the customer-generator shall be credited to the customer monthly as follows: a. Summer season eEnergy credit for billings based on generation during the months of June, July and August Per kWh $0.0430 $0.0439 Section 10. That the amendments herein are effective and shall go into effect as follows: a. Amended commercial schedule tiered rates (GS, GS25, GS50, GS750 & SS) shall apply to all electricity used on or after January 1, 2018; b. Amended schedules of tiered rates for all other rate classes shall apply to all bills issued on the basis of meter readings on or after January 1, 2018; c. Schedules of residential TOU rates (R and RD rate classes) shall apply to all bills issued on the basis of meter readings on or after October 1, 2018. Introduced, considered favorably on first reading, and ordered published this 7th day of November, A.D. 2017, and to be presented for final passage on the 21st day of November, A.D. 2017. __________________________________ Mayor ATTEST: _______________________________ City Clerk Passed and adopted on final reading on the 21st day of November, A.D. 2017. __________________________________ Mayor ATTEST: _______________________________ City Clerk -1- ORDINANCE NO. 156, 2017 OF THE COUNCIL OF THE CITY OF FORT COLLINS AMENDING CHAPTER 26 OF THE CODE OF THE CITY OF FORT COLLINS TO REVISE WATER RATES, FEES, AND CHARGES AND UPDATING RELATED PROVISIONS WHEREAS, the City Council is empowered and directed by Article XII, Section 6 of the Charter of the City of Fort Collins, to by ordinance from time to time fix, establish, maintain and provide for the collection of such rates, fees or charges for utility services furnished by the City as will produce revenues sufficient to pay the costs, expenses, and other obligations as set forth therein; and WHEREAS, the rates, fees or charges for utility services set forth herein are necessary to produce sufficient revenues to provide the utility services described herein; and WHEREAS, the revenue from the rates, fees or charges for utility services set forth herein shall be used to defray the costs of providing such utility services as required by the Charter and the City Code; and WHEREAS, Article III, Chapter 26 of the City Code establishes the water utility as a utility service furnished by and an enterprise of the City; and WHEREAS, City Code Sections 26-126, 26-127 and 26-129 concern various water- related rates, fees, and charges; and WHEREAS, City Code Section 26-118 requires that the City Manager analyze the operating and financial records of the utility during each calendar year and recommend to the City Council user rates or adjustments to be in effect for the following year; and WHEREAS, the City Manager and City staff have recommended to the City Council adjustment of the water-related rates, fees, and charges as set forth herein to be effective January 1, 2018; and WHEREAS, the rate increase for water set forth herein is 5.0% overall, with variations for customer rate classes; and WHEREAS, it is beneficial to revise the definition of “peaking factor” in City Code Section 26-41 in order to more appropriately account for single days of high water deliveries that may be unrepresentative outliers due to system flushing and other operations that do not represent the true demand for treated water; and WHEREAS, the Water Board considered the proposed water-related rates, fees, and charges adjustments for 2018 at its meeting on October 12, 2017, and recommended approval of the proposed adjustments by a unanimous vote; and -2- WHEREAS, based on the foregoing, City Council desires to amend Chapter 26 of the City Code to adjust the scope and rate of the water-related rates, fees, and charges as set forth herein. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That the City Council hereby makes any and all determinations and findings contained in the recitals set forth above. Section 2. That Section 26-41 of the Code of the City of Fort Collins is hereby amended to read as follows: Sec. 26-41. - Definitions. The following words, terms and phrases, when used in this Article, shall have the meanings ascribed to them in this Section: … Peaking factor shall mean the ratio of the average of the five (5) highest daily amounts of water delivered in a single day for during the year to the average daily demand for that year. … Section 3. That Section 26-126 of the Code of the City of Fort Collins is hereby amended to read as follows: Sec. 26-126. - Schedule A, flat rates for unmetered construction water use. For residential and nonresidential premises under construction with a planned meter size greater than one (1) inch, no flat unmetered water service will be provided. For residential and nonresidential premises under construction with a planned meter size of one (1) inch or less, the following flat rates will apply per month until the permanent meter is set: ¾-inch construction service, flat charge per month $28.26 $29.44 1-inch construction service, flat charge per month $53.88 $56.14 Section 4. That Section 26-127 of the Code of the City of Fort Collins is hereby amended to read as follows: Sec. 26-127. - Schedule B, meter rates. -3- (a) Residential rates. (1) Residential customers with one (1) dwelling unit shall pay the sum of the following changes: a. Base monthly charge for residential customers with one (1) dwelling unit $16.18 $16.86 b. Quantity monthly charge for residential customers with one (1) dwelling unit Tier 1 - For the first seven thousand (7,000) gallons used per month, per one thousand (1,000) gallons $2.505 $2.611 Tier 2 - For the next six thousand (6,000) gallons used per month, per one thousand (1,000) gallons $2.879 $3.000 Tier 3 - For all additional gallons used per month, per one thousand (1,000) gallons $3.312 $3.451 (2) Residential customers with two (2) dwelling units shall pay the sum of the following charges: a. Base monthly charge for residential customers with two (2) dwelling units $17.13 $17.74 b. Quantity monthly charge for residential customers with two (2) dwelling units Tier 1 - For the first nine thousand (9,000) gallons used per month, per one thousand (1,000) gallons $2.175 $2.253 Tier 2 - For the next four thousand (4,000) gallons used per month, per one thousand (1,000) gallons $2.499 $2.589 Tier 3 - For all additional gallons used per month, per one thousand (1,000) gallons $2.876 $2.979 (3) Residential customers with more than two (2) dwelling units shall pay the sum of the following charges: a. Base monthly charge for residential customers with more than two (2) dwelling units First dwelling unit $12.31 $12.75 Second and each additional dwelling unit $4.10 $4.24 b. Quantity monthly charge for residential customers with more than two (2) dwelling units Winter - per one thousand (1,000) gallons used in the winter season months of November through April $1.788 $1.853 Summer - per one thousand (1,000) gallons used in the summer season months of May through October $2.235 $2.316 The meter reading date shall generally determine the seasonal monthly quantity charge; however, no customer shall be billed more than six (6) full billing cycles at the summer quantity charge. -4- (b) Nonresidential rates. (1) Base charge. Nonresidential, except for special users as described in Subsection 26-127(c) below, customers shall pay a base monthly charge based on meter size as follows: Meter Size (inches) Monthly Base Charge ¾ $14.31 $15.26 1 $39.93 $42.57 1½ $108.58 $115.75 2 $163.64 $174.44 3 $249.59 $266.06 4 $391.83 $417.69 6 $760.11 $810.27 8 $1,342.79 $1,431.42 (2) Quantity charges. Nonresidential customers shall pay monthly charges as follows: Winter - per one thousand (1,000) gallons used in the winter season months of November through April $1.992 $2.123 Summer - per one thousand (1,000) gallons used in the summer season months of May through October $2.489 $2.653 The meter reading date shall generally determine the seasonal monthly quantity charge; however, no customer shall be billed more than six (6) full billing cycles at the summer quantity charge. (3) Charges for excess use. Nonresidential customers shall also pay monthly water use charges in excess of the amounts specified in the following table: Winter - per one thousand (1,000) gallons used in the winter season months of November through April $2.861 $3.050 Summer - per one thousand (1,000) gallons used in the summer season months of May through October $3.578 $3.815 The meter reading date shall generally determine the seasonal monthly quantity charge; however, no customer shall be billed more than six (6) full billing cycles at the summer quantity charge. Meter Size (inches) Specified Amount (gallons per month) ¾ 100,000 -5- 1 300,000 1½ 625,000 2 1,200,000 3 1,400,000 4 2,500,000 (c) High volume industrial rates. High volume industrial rates apply to any customer with an average daily demand in excess of two million (2,000,000) gallons per day. The specific rate for any qualifying customer shall be based upon the applicable peaking factor for that customer as follows: Peaking Factor Monthly Charge per Thousand Gallons 1.00—1.09 $1.56 $1.66 1.10—1.19 $1.62 $1.72 1.20—1.29 $1.67 $1.78 1.30—1.39 $1.72 $1.83 1.40—1.49 $1.77 $1.89 1.50—1.59 $1.83 $1.94 1.60—1.69 $1.88 $2.00 1.70—1.79 $1.93 $2.06 1.80—1.89 $1.98 $2.11 1.90—1.99 $2.05 $2.18 > 2.00 $2.10 $2.23 . . . Section 5. That the modifications set forth above shall be effective for meter readings on or after January 1, 2018, and in the case of fees not based on meter readings, shall be effective for all fees paid on or after January 1, 2018. -6- Introduced, considered favorably on first reading, and ordered published this 7th day of November, A.D. 2017, and to be presented for final passage on the 21st day of November, A.D. 2017. __________________________________ Mayor ATTEST: _______________________________ City Clerk Passed and adopted on final reading on the 21st day of November, A.D. 2017. __________________________________ Mayor ATTEST: _______________________________ City Clerk -1- ORDINANCE NO. 157, 2017 OF THE COUNCIL OF THE CITY OF FORT COLLINS AMENDING CHAPTER 26 OF THE CODE OF THE CITY OF FORT COLLINS TO REVISE WASTEWATER RATES, FEES, AND CHARGES WHEREAS, the City Council is empowered and directed by Article XII, Section 6 of the Charter of the City of Fort Collins, to by ordinance from time to time fix, establish, maintain and provide for the collection of such rates, fees or charges for utility services furnished by the City as will produce revenues sufficient to pay the costs, expenses, and other obligations as set forth therein; and WHEREAS, the rates, fees or charges for utility services set forth herein are necessary to produce sufficient revenues to provide the utility services described herein; and WHEREAS, the revenue from the rates, fees or charges for utility services set forth herein shall be used to defray the costs of providing such utility services as required by the Charter and the City Code; and WHEREAS, Article IV, Chapter 26 of the City Code establishes the wastewater utility as a utility service furnished by and an enterprise of the City; and WHEREAS, City Code Sections 26-280 and 26-282 concern various wastewater-related rates, fees, and charges; and WHEREAS, City Code Section 26-277 requires that the City Manager analyze the operating and financial records of the utility during each calendar year and recommend to the City Council user rates or adjustments to be in effect for the following year; and WHEREAS, the City Manager and City staff have also recommended to the City Council adjustment of the wastewater-related rates, fees, and charges as set forth herein to be effective January 1, 2018; and WHEREAS, the rate increase for wastewater set forth herein is 3.0% with variations for individual customer rates classes; and WHEREAS, the Water Board considered the proposed wastewater-related rates, fees, and charges adjustments for 2018 at its meeting on August 17, 2017, and recommended approval of the proposed adjustments by a unanimous vote; and WHEREAS, based on the foregoing, City Council desires to amend Chapter 26 of the City Code to adjust the scope and rate of the water-related rates, fees, and charges as set forth herein. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: -2- Section 1. That the City Council hereby makes any and all determinations and findings contained in the recitals set forth above. Section 2. That Section 26-280 of the Code of the City of Fort Collins is hereby amended to read as follows: Sec. 26-280. Service charges established by category. The schedule of rates for each category described in § 26-279 shall be as follows: Category Class of Customer Rate A Single-family residential user (flat rate) Per month $39.46 $40.05 Single-family residential user (metered water use) 1. Per month $17.63 $17.90 2. Plus, per 1,000 gallons per month $3.426 $3.477 Note: 1. For single family customers who have not yet established a winter quarter water use at the service address, a system average of 4,800 4,000 gallons per month shall be billed. 2. After establishment of a winter quarter water use at the service address, the monthly amount billed shall be based on a minimum of 3,000 gallons per month. B Duplex (two-family) residential users (flat rate) Per month $54.05 $55.41 Duplex (two-family) residential users (metered water use) Per month $20.02 $20.52 Or, per 1,000 gallons per month, whichever is greater, to be calculated on a monthly basis $3.006 $3.081 Note: 1. For duplex customers who have not yet established a winter quarter water use at the service address, a system average 7,200 6,200 gallons shall be billed. 2. After establishment of a winter quarter use at the service address, the monthly amount billed shall be based on a minimum of 4,000 gallons per month. C Multi-family residential user (more than two dwelling units including mobile home parks) and winter quarter based nonresidential user 1. Base charge per month per dwelling unit served $2.61 $2.75 2. Plus, per 1,000 gallons per month $3.319 $3.498 Note: -3- 1. For multi-family customers who have not yet established a winter quarter water use at the service address, a system average of 3,400 3,200 gallons per living unit shall be billed. However, Category D rates will apply to multi-family residential units under construction during the period of service from the installation of the water meter to the date the certificate of occupancy is issued. 2. After establishment of a water quarter use at the service address, the monthly amount billed shall be per 1,000 gallons of winter quarter water use, calculated on a monthly basis. D Minor nonresidential user 1. Per 1,000 gallons of water use, measured sewage flow or winter quarter water use, whichever is applicable, to be calculated on a monthly basis, plus the following applicable base charge: $3.130 $3.293 2. Size of water meter (inches) Base charge ¾ or smaller $9.03 $9.50 1 $20.85 $21.93 1½ $41.96 $44.14 2 $71.80 $75.53 3 $114.72 $120.69 4 $181.18 $190.60 6 $794.25 $835.55 8 $917.07 $964.76 E and F Intermediate nonresidential user and Significant industrial user User shall pay an amount calculated to include: 1. Rate per 1,000 gallons of water use, measured wastewater flow or winter quarter water use per month, whichever is applicable; $3.130 $3.293 2. PLUS a surcharge per million gallons for each milligram per liter of suspended solids in excess of 235 milligrams per liter; $3.641 $3.830 3. PLUS a surcharge for the following: a. per million gallons for each milligram per liter of BOD in excess of 265 milligrams per liter; or $3.033 $3.191 b. per million gallons for each milligram per liter of COD in excess of 400 milligrams per liter; or $1.915 $2.014 c. per million gallons for each milligram per $5.668 $5.963 -4- liter of TOC in excess of 130 milligrams per liter, whichever is applicable. The user shall pay the calculated amount based on 1, 2 and 3 above, plus the applicable base charge set forth below: Size of water meter (inches) Base charge ¾ or smaller $9.03 $9.50 1 $20.85 $21.93 1½ $41.96 $44.14 2 $71.80 $75.53 3 $114.72 $120.69 4 $181.18 $190.60 6 $794.25 $835.55 8 $917.07 $964.76 G User outside City limits The rate for users outside the City limits shall be the same as for like service inside the City limits as is specified in Categories A—F and H in this Section. H Special with agreement The rate pursuant to a special wastewater services agreement approved by the City Council pursuant to § 26-290 shall be set forth in said agreement. Section 3. That Section 26-282(a) of the Code of the City of Fort Collins is hereby amended to read as follows: Sec. 26-282. - Wastewater strength or industrial surcharges and categories established. (a) A monthly wastewater strength surcharge shall be paid by customers located either inside or outside the City limits in accordance with the following schedule: Parameter Excess over (mg/l) Rate per thousand gallons BOD 265 355 $0.003033 $0.003452 COD 400 540 $0.001915 $0.002269 TOC 130 170 $0.005668 $0.007208 TSS 235 365 $0.003641 $0.003474 . . . -5- Section 4. That the modifications set forth above shall be effective for meter readings on or after January 1, 2018, and in the case of fees not based on meter readings, shall be effective for all fees paid on or after January 1, 2018. Introduced, considered favorably on first reading, and ordered published this 7th day of November, A.D. 2017, and to be presented for final passage on the 21st day of November, A.D. 2017. __________________________________ Mayor ATTEST: _______________________________ City Clerk Passed and adopted on final reading on the 21st day of November, A.D. 2017. __________________________________ Mayor ATTEST: _______________________________ City Clerk