6.1. ERMUSR 07-08-2003 Elk River
Municipal Utilities
322 King Avenue phone: 763.441.2020
Elk River.MN 55330 Fax_'63.+41.8099
June 25, 2003
To: Elk River Municipal Utilities Commission
John Dietz
Jerry Takle
James Tralle
From: Bryan C. Adams
Subject: Wholesale Electric Rate
Late last year, we had a brief discussion about Great River Energy's future rate structure.
As an incentive for Great River Energy member co-op to extend their all requirement
power and energy contracts with Great River Energy, Great River Energy is offering a
two tier rate. All of Great River Energy's members have extended their contracts and the
two tier rate has been adopted in principal. The details of this two tier rate structure has
been worked out except for the actual rate.
The highest demand and energy per month for years 2001, 2002, and 2003. will establish
the quantity base for the base year. Because of Elk River's fast growth, the highest of
these three years will be our demand and energy for 2003. These values will be corrected
for our demand customers who are interruptible (Cub Foods and Aggregate Industries).
This base quantity will be fixed at a demand and energy rate. Any growth above the base
quantities will be at a different demand and energy rate. The attached spread sheet and
graph, hopefully shows more clearly the future rate structure. The proposed rates are just
that..."proposed" and will not be adopted until later in the year. These proposed rates
will undoubtedly change.
The 5% Option, which is the more favorable rate will expire in 2006. Great River Energy
is estimating a 5.1% rate increase for 2004 and a 1.8% increase per year thereafter.
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Elk River Municipal Utilities Proposed Wholesale Demand Electric Rate
40000
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35.000
30,OOD ■ ui . .. el
25.000 -
c 20'000 I I ■%Growth
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g 15000 ..'
■ I .Tier 1 Demand
10.000 ■ I I
: I 1111 III IIIII.
III
Jan Feb Mar April May June July Aug Sept Oct Nov Dec
Months
Elk River Municipal Utilities Proposed Wholesale Energy Electric Rate
25 000,000- — -
20,000,000
■
•
15,000,000
in m I. . .. OOrow h Above Base
is ■5%Option
`a •Tier 1 Energy
w 10,000,000
IIISp0O000
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Jan Feb Mar April May June July Aug Sept Oct Nov Dec
Months