Weatherly electric costs to increase

Last year, Weatherly Borough Council members were excited to be able to approve a contract that would pass along $200,000 per year in savings to electric customers in the borough.

So it came as a shock when their energy consultant recently informed them that residents’ rates were actually going up this year.

On Monday, the consultant, Utility Engineers PC, explained how improvements by PPL have basically wiped out any savings from the new contract, for the time being.

“Had you not done that contract deal for the extension, and brought back $200,000 this year, you would have been looking at a rate increase this year,” said Jim Havrilla, an engineer with Utility Engineers.

The contract extended a deal that originally ran through 2022 for another five years, through 2027. The borough chose to “blend and extend” those contracts, reducing the bulk rate to 59.49 per MWh from 69.70 per MWh. In all, they are projected to save $2 million through 2027, or $200,000 per year.

So what happened to the $200,000 that the borough was supposed to save this year? Havrilla said that last year’s contract, and the savings, is only one part of the electric bill that residents pay.

The rest of the bill goes toward transmission and capacity costs. And Havrilla explained that the borough’s cost of transmission has gone up significantly in 2018. He said PPL has been making a major investment in its transmission system in an effort to reduce the number of outages. It’s coming back in the form of a higher cost.

“It’s almost like a smack in the face. We thought we were going to save money here,” Councilman Joseph Cyburt said. “By the time this is all done, we’re not sitting any better than we were.”

Havrilla said that transmission and capacity weren’t part of the scope of the work they did when they lined up the energy supply contract for the borough along with 34 other municipalities in Pennsylvania that operate their own electric companies.

He said that while they can purchase energy supply several years in advance, transmission and capacity costs are set each year, and there is less room to negotiate.

Does that mean that the borough will never see the savings? Not necessarily, Havrilla said.

He said transmission and capacity costs often fluctuate up and down.

“Will you see that magnitude? Likely not. But you will see movement up and down,” Havrilla said.

Other business

• Borough street sweeping was postponed until May 7 because of weather this week. The new date allows the borough to notify residents of the sweeping schedule through their next utility bill.

• Resident Brian O’Donnell said there is an Earth Day event planned on Sunday at Tweedle Park from 12:30 to 3 p.m. It will include live music. Residents are asked to bring a rake or other gardening tool.

• Council authorized the American Legion to hold a parade on Memorial Day in the borough and made a $500 donation to the Legion Auxiliary.