The city council of Nixa, Mo., recently voted to lower electric rates for the next few years for customers of public power utility Nixa Utilities.
Residential customers will see the rate drop about 2 cents per kilowatt hour -- from over 12.3 cents per kilowatt hour down to 10.5 cents per kilowatt hour -- on their April bill.
Nixa Utilities has not raised rates charged for electric power since 2017.
An annual 1.5% increase over the new, lower rate will take effect in 2023, to keep the electric rates up with the cost of inflation, but the five-year rate plan means that in 2024, Nixa Utilities residential customers will be paying about the same as they did in 2017.
Commercial and industrial customers will pay lower rates well past 2027 as an incentive to bring good jobs to Nixa, a city news release noted.
“For more than five years, we’ve been working hard to get to this moment,” said Doug Colvin, Director of Nixa Utilities and Public Works. “We have new agreements to get Nixa’s power at lower prices, reducing our utility’s risk exposure to volatile pricing on the open market,” said Colvin.
“We also sold Nixa’s transmission system a few years ago. That move saved us from expensive maintenance and regulatory compliance costs, while allowing the utility to pay off its debt completely.”
“All this work has made this moment possible, where we are able to actually lower rates while continuing to invest in improvements to our city’s electric grid,” said Nixa Mayor Brian Steele. “Now we’re spending down excess reserves to essentially give some of this money back to our customers through lower electric rates. For the next few years, we’ll be charging customers less than it costs us to buy power and maintain the system which carries that power to homes and businesses.”
Even despite the surging prices caused during the winter storm in February 2021, Nixa Utilities held rates steady for its customers, the city noted.
Premiums associated with price spikes for power purchased from the national grid were paid using the utility’s reserves.
“Going forward, an Energy Cost Adjustment charge on customer bills will spread out the cost of any surge pricing for future events, but won’t impact Nixa Utilities customers dramatically because the utility only purchases a relatively small amount of its power at the going market rates,” said Colvin.