Lake crystal seeks to help residents with electricity rates local news mankatofreepress.com gas and supply locations

The program is an extension of the city’s Load Management Program, a free installation of a switch on household appliances that lets them be briefly cycled off during periods of high demand for power. That program started last summer and 200 switches have been signed on, said City Administrator Taylor Gronau. Households receive a credit of half a cent per kilowatt hour on their monthly utility bill for each device enrolled.

In 2009, Lake Crystal renewed a contract with Heartland Consumers Power District of South Dakota. Under the contract, which runs through 2041, Lake Crystal buys electricity and sells it based on rates the local commission sets, which are based to some extent on the power bill from Heartland.

Customer bills surged in 2014 when the commission raised the base rate by 1.5 cents per kilowatt-hour and temporarily removed a cap on the power cost adjustment. Though the city has taken several measures to stabilize rates, some in Lake Crystal say bills are high, with one business owner saying the utility bill tops $2,000 per month. Homeowners say monthly bills, which in Lake Crystal include electricity, water, sewer and waste pickup, are around $250 to $300.

Heartland sells electricity to 29 Midwestern municipalities, including Madelia and New Ulm, at the same rate, said Chief Financial Officer Mike Malone. The company is working to stabilize rates, but "we do anticipate some increase in cost over the next couple of years," Malone said.

Gronau said Madelia’s rate is lower in part because it has more industrial users. In Madelia, the residential rate is about 14 cents per kilowatt hour with a $5 meter fee per month, compared with about 16 cents per kilowatt hour with a $10.35 per meter fee in Lake Crystal. Xcel Energy, which serves Mankato, charges Minnesota residential customers about $8 to $10 for a meter fee with about 8 cents to 9 cents per kilowatt hour. Xcel bills are subject to other adjustments that add about $.0031 kilowatt-per-hour of charges. Fees can vary for other individualized reasons.

Gronau said Heartland’s rates were competitive when the commission signed the 2009 contract. Members of that commission are appointed by City Council but act independently. When concern surfaced over rates in 2014, the city and the commission looked into the possibility of ending or changing the contract but determined that was not possible, Gronau said.

"I do think (Heartland) has been very sensitive to their rates," Gronau said. "They’re aware that their rates and their costs are high, and they have been offering a number of services in the form of energy audits and the like to help reduce the cost of power."

Mayor Brad Ahrenstorff said it’s up to the consumer to conserve electricity and said he hopes the new competition educates people on how to reduce personal costs. He said he lives in a two-story, three-bedroom home built in the 1800s and doesn’t feel his bill is high. He also noted three new businesses have opened on Main Street in the past six months.

Tom Farrell, superintendent of Lake Crystal schools, praised the city for its efforts to help the district reduce energy costs. This spring the district received software that enables it to track peak usage so utilities can be cycled off to help reduce costs. The district applied for and received an intern through Minnesota GreenCorps who will work with the district next school year on energy conservation.