Mayor OKs LADWP Rate Hike

Los Angeles Mayor Antonio Villaraigosa endorsed a 22% electricity rate hike for Los Angeles Department of Water and Power customers to fund the city’s migration from coal to renewable energy.

Once fully implemented, the rate hikes would cost local businesses and residents $648 million a year, according to the Los Angeles Times.

LADWP officials said they needed the rate hikes to meet policymakers’ goal of generating 20% of the city’s electricity from renewable sources by this year and 40% by 2020, while protecting the utility’s double-A bond ratings.

The rate increase would also fund creation of a Renewable Energy and Energy Efficiency Trust Fund that would fund new renewable-energy development, subsidies for solar power, and energy-efficiency programs.

LADWP officials also said they also need more money to offset expenses being shifted to the utility from the city’s general fund.

A staff report said that the LADWP has accepted the transfer of 1,480 general fund employees since fiscal 2007. That is costing the utility $172 million a year and increased its pension and retiree health obligations by $578 million.

The utility said that even with the proposed rate hikes it will have lower rates than local investor-owned utilities.

The LADWP’s board was set to consider the rate proposal yesterday. If approved, the Los Angeles City Council would also have to sign off on the hikes.

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