New electric contract will cost city, customers
A five-year Westar Energy contract will mean slightly higher electrical bills for city residents.
The contract was reviewed Monday by Marion City Commission.
Bill Howgill, a Westar business manager, presented the information to the commission.
A yearly transmission charge, which is a requirement of all utility companies, may increase the city's Westar bills by $80,000 or more per year.
Demand fuel adjustments will be slightly reduced while peak usage will be increased.
The city's current wholesale contract expires July 1, but in order to "lock in" the proposed prices, commissioners must approve the contract before March.
If the city does not meet the March deadline, the city would be a part of preferential pricing which will affect all Westar's wholesale customers. This would place all wholesale customers in a pool with pricing determined by average costs.
Howgill also assured city officials the contract will not be changed if Westar should receive an anticipated rate increase to offset unplanned ice storm expenses.
"Once the prices are locked in, the city is locked in," Howgill said.
"The good news is the new contract is very competitive with what you have," said Howgill. "Actual energy is much cheaper."
The commission will consider the contract at Monday's meeting.
