JACKSONVILLE, Fla. — JEA will unveil at its board retreat on Wednesday a projected 32%-45% compounded increase to base rates from FY23 to FY32.
Remember, JEA already increased base rates 3% in 2021. The goal is $250M-$340M in new revenue to “support the total system requirements.”
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A fancy way of saying the utility needs more money?
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JEA tells Becker, “Total system requirements mainly consist of cost related to operations & maintenance, capital, and debt service. We created these analyses for the board to see JEA’s financial outlook based on various scenarios. The board will vote on base rate increases during annual rate hearings.”
Becker’s general summary:
Electric base rates forecasted to increase has nothing to do with fuel, which is totally separate and has also increased dramatically.
- Optimized scenario: 31% by 2032 (not including base rate increase completed in 9/2021)
- Base case scenario: 39% by 2032 (not including base rate increase completed in 9/2021)
- High scenario: 41% by 2032 (not including base rate increase completed in 9/2021)
Main drivers:
- No growth in sales
- Cost of Vogtle - >$200MM/ yr
- Increases in O&M costs – 4-9% growth / year
And in JEA’s words:
“In a scenario where sales are projecting to decline and customer growth does not occur, all expenses will first have to be re-evaluated. Then, based on those recast revenue requirements, the base rate targets could be adjusted.”
What happens if JEA has to “reevaluate expenses?”
Adjustable O&M expenses largest to smallest:
- Labor
- Other O&M
- City contribution
And that is with the hope that sales stay the same.
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