With budget season upon us, Seattle City Light (SCL) couldn’t have chosen a more timely moment to update its Strategic Plan, which includes an update on the planned rate increases for 2017.
Rates even out once SCL implements its Strategic Plan. The average rate for buildings in the City of Seattle in 2017 will be 5.9%.
What is the Strategic Plan? SCL first created a six-year strategic plan in 2012 to publicly define its standards for the programs and investments required to provide reliable operations and customer service. City Light has defined these areas through four main objectives:
- 1: Improve customer experience and rate predictability
- 2: Increase workforce performance and safety practices
- 3: Enhance organizational performance
- 4: Continue conservation and environmental leadership
SCL continues to update and improve upon this plan every two years, and most recently approved a new version for 2017-2022. While each of these goals is vital to Seattle as a community, Objective 1 is arguably the most relevant for commercial property managers and engineers during budget season.
Rates are notoriously volatile and unpredictable, oftentimes making Excel-based budget planning more of an art than a science. Many building operators have to suffice with an educated estimation about rate changes, but SCL is addressing this issue through its Strategic Plan and by making the details of its projected increases easy to find online. Customers looking to take the guesswork out of calculating the coming year’s energy costs can read through City Light’s 2017-2018 Proposed Retail Rates presentation, while those interested in getting a step more granular can plug their numbers into the Customer Bill Calculator. Users of Gridium’s Billcast can also access a data-driven budget forecast, rationalized to historical weather data and the building’s energy profile, at the push of a button.
An important element of SCL budget calculations is the Rate Stabilization Account (RSA) surcharge. Seattle City Light created the RSA to keep a fund of approximately $100 million in reserve in the event that wholesale energy market prices and/or hydroelectric production changes cause City Light’s revenue to unexpectedly decrease. Whenever cash from the RSA is used, the fund is replenished through the RSA surcharge, which is adjusted based on how full or depleted the fund is, and is applied to consumers’ electricity bills. As of August 1, 2016, the RSA had a balance of $89.1mm and therefore the surcharge dropped to $1.5%.
As the calendar turns from summer to fall, budget planning may not elicit the same joy that a familial holiday feast does. With Seattle City Light’s Strategic Plan and the tools that come with it, however, your budgetary spinach can be transformed from steamed to creamed.
