When does a customer rebate save a business money? When the business is the consortium of 18 public utility commissions in Southern Minnesota Municipal Power Agency (SMMPA) and the rebates reduce electrical usage and prevent a need to build a bigger power plant. Energy Service Representative Keith Butcher met with the Grand Marais Public Utilities Commission (PUC) March 23 and answered some questions on who qualifies for rebates.
State statute requires municipal utility agencies to offer rebates on things like light bulbs and energy efficient appliances in order to decrease electrical usage. The rebates increase rates, impacting lowincome customers the most, but offering them is cheaper than building new plants to meet the growing demand for power, Butcher said.
The PUC asked Butcher why renters couldn’t take advantage of a small program the city offers in partnership with the Arrowhead Economic Opportunity Agency (AEOA) that provides new appliances to low-income customers. Butcher said SMMPA does not want to open the door for commercial enterprises, such as landlords, to benefit from the program, particularly if the beneficiaries move and do not take the new appliances with them.
PUC Chair Hal Greenwood said that in Grand Marais, the biggest rental category is the one that includes lowincome residents in subsidized housing. These housing units, such as Birchwood Apartments, Grand Marais Apartments, and Harbor View Apartments, are not owned by commercial enterprises, he said.
Commissioner Tim Kennedy said he is concerned about not getting resources to the people who need them the most.
Butcher said he would contact the administrators of the three housing units and investigate the possibility of including qualifying renters in the appliance program.
Shadow billing
The board discussed SMMPA’s new “shadow billing” program that shows each of its communities how much power it has used at low, medium, and high usage periods each month. SMMPA is considering charging more per kilowatthour during hours of peak usage and less during hours of low usage. Grand Marais already pays one rate for usage during “on-peak” hours and another for usage during “off-peak” hours.
Electric Superintendent Mike Taylor said he doesn’t think gas stations and hotels would be able to modify their electric use. The department has technology that would allow them to monitor how the larger businesses would be affected by the proposed rate structure.
Taylor also said he expects Grand Marais’ electric costs to be about the same even if SMMPA approves the new rate structure. SMMPA will decide whether or not it will move to the new rate structure after it monitors usage for a year.
City Administrator Mike Roth, however, said that if enough PUC customers voluntarily modified their electric usage, it could affect Grand Marais’ wholesale price and ultimately, their monthly bills. Grand Marais could participate in “load management” in which the PUC would notify customers during hours of peak usage and ask them to lower their use.
Utility Administrative Specialist Jan Smith said that if SMMPA decides to go with the new rate structure, saving on electric costs “could be as simple as turning on your dishwasher when you go to bed at night instead of right after dinner.”
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