LP&L seeks outside training, expertise on setting rates - KCBD NewsChannel 11 Lubbock

LP&L seeks outside training, expertise on setting rates

LUBBOCK, TX (KCBD) -

How can Lubbock Power & Light set electric rates for residential, commercial, non-profits, and industrial customers if it has no rate model?  For many years LP&L simply relied on Xcel Energy's rate model but over the course of time the city-owned utility moved further and further from Xcel's model for setting rates. 

"LP&L has not had a rate study," says a recent request for qualifications.  So, now LP&L has neither Xcel's rate model nor one of its own. 

The RFQ is an invitation for a professional firm to be hired, "to guide [city] personnel through the process … to prepare future rate studies independently."

Some of the items LP&L needs to learn are financial planning, cost of service, and rate design.

Former Mayor Marc McDougal is on the Lubbock Power & Light Board of Directors.  He says, "We have asked for a study on rate models." 

It's not the LP&L Board, but City Council that has final say on the rates.  McDougal was once on the City Council and he wants the elected officials to feel confident about LP&L's numbers.

He also wants LP&L fully prepared for a big problem coming up in about seven years.  Xcel Energy will, for the most part, stop selling wholesale electricity to LP&L. 

"We have a group that's helping us with our generation problem in 2019," McDougal says.  That might mean finding new wholesale partners or it might mean building power plants.  LP&L has three such generation facilities but they're not nearly enough to power the entire city.

For now LP&L has some of the lowest electric rates in Texas.  McDougal says, "We're 17 % below the Texas average."  He also says LP&L is "36% below the regional average."  Regional in this case means the greater Lubbock area.

Copyright 2012 KCBD.  All rights reserved.

  • Local News on KCBD.comNewsMore>>

  • Recall: Death Wish Coffee's cold brew could cause botulism

    Recall: Death Wish Coffee's cold brew could cause botulism

    Thursday, September 21 2017 11:53 AM EDT2017-09-21 15:53:03 GMT
    Thursday, September 21 2017 11:53 AM EDT2017-09-21 15:53:03 GMT

    Death Wish Coffee Co. has recalled its 11 oz. cans of Nitro Cold Brew coffee because of concerns that its production process could breed botulin.

    Death Wish Coffee Co. has recalled its 11 oz. cans of Nitro Cold Brew coffee because of concerns that its production process could breed botulin.

  • Democrats want closer look at Price's private jet travel

    Democrats want closer look at Price's private jet travel

    Wednesday, September 20 2017 5:55 PM EDT2017-09-20 21:55:44 GMT
    Thursday, September 21 2017 11:45 AM EDT2017-09-21 15:45:36 GMT

    Health and Human Services Secretary Tom Price can't always fly commercial, spokeswoman says.

    Health and Human Services Secretary Tom Price can't always fly commercial, spokeswoman says.

  • A stunned Puerto Rico seeks to rebuild after Hurricane Maria

    A stunned Puerto Rico seeks to rebuild after Hurricane Maria

    Thursday, September 21 2017 3:46 AM EDT2017-09-21 07:46:11 GMT
    Thursday, September 21 2017 11:37 AM EDT2017-09-21 15:37:21 GMT

    Maria hit the island Wednesday morning as a Category 4 storm with 155 mph winds, the strongest hurricane to hit Puerto Rico in over 80 years.

    Maria hit the island Wednesday morning as a Category 4 storm with 155 mph winds, the strongest hurricane to hit Puerto Rico in over 80 years.

Powered by Frankly