City to Consider New LP&L Billing Method This Week

This week the Lubbock City Council is will consider a new method of calculating the monthly electric bills for Lubbock Power & Light.

By James Clark

LUBBOCK, TX -- This week the Lubbock City Council will consider a new method of calculating the monthly electric bills for Lubbock Power & Light.  The idea is to make bills more predictable for customers.

Currently a portion of LP&L electric bills fluctuate from one month to the next based how much LP&L spends for wholesale power.  Under a proposed new tariff, LP&L will estimate the wholesale costs in advance, and keep that portion of the bill constant. 

If LP&L collects too much money it goes into a “balancing account.”  If LP&L collects too little the shortfall is taken from that same “balancing accounts.” 

So where will the money come from to start the balancing account?

 “Initially, $3.5 million will be carved out of the existing reserves at LP&L,” according to the City Council’s backup materials for its Thursday meeting.  LP&L will try to keep the balancing account between $0 and $7 million. 

Mayor Glen Robertson said, “It should stop those violent swings we saw this summer.”

The Mayor was making reference to monthly bills that went up hundreds of dollars after the City Council approved an LP&L rate hike.  People were told that bills would go up 9.7%.  But the results of the rate hike were much more dramatic.

Members of both the LP&L Board and the City Council called for a rate stabilization model.

“Rate stabilization is a good idea.  I think it will help the customers,” Robertson said.

The LP&L Board already approved the proposed tariff but the City Council has the final say on rates.  If approved on Thursday the new system would go into effect on December 31.

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