Casey Proposes Electric Rate Hike to Stave Off Deficits; Gas Rates Next Under Review

Casey residents may soon see an increase in their electricity bills as the City Council considers raising rates for the first time in years to combat significant financial losses in its utility fund. The proposal comes as officials also begin reviewing the city’s gas rates, which have not been adjusted since 2009.

During its July 21 meeting, the council’s Utility Committee, led by Alderman Lori Wilson, proposed increasing the base electricity rate from 12 cents to 16 cents per kilowatt-hour. The plan would retain the existing 1-cent-per-kilowatt-hour discount for timely payments, resulting in a net rate of 15 cents for most customers.

“We are to the point with the water and the sewer rates increase that we need to increase the electricity rates as well,” Wilson told the council, presenting the committee’s recommendation. “We have not increased electricity rates for years.”

The proposed 15-cent net rate remains below the national average of 18 cents per kilowatt-hour and significantly lower than rates from regional providers like Ameren, which recently increased its rate to 27 cents per kilowatt-hour, according to Mayor Mike Nichols.

Nichols detailed the financial pressures forcing the decision, noting the city’s electric fund lost over $500,000 last year. He attributed the deficit to a combination of rapidly rising supply and material costs and a shrinking customer base to share those fixed costs.

“You’ve got expenses increasing at a rapid rate in all lines of utilities,” Nichols said. “We’ve lost about 200 households that are sharing a higher number of costs. So, we’re going to have to make some adjustments. We know that.”

The mayor stressed that the increase is necessary to maintain the city’s independent utility service. “We don’t have a choice if we want to stay independent and we don’t want to be subject to somebody else telling us when they’re going to come and service our electric,” he said. “It’s just something that’s got to be done.”

In addition to the electric rate hike, officials confirmed that natural gas rates are also under review. Utility Superintendent Shelby Biggs is currently analyzing pricing, with Nichols noting that the best time to lock in favorable rates is during the summer months of July and August when usage is low. The last time the city adjusted gas rates was in 2009.

To ensure transparency, the city plans to include an informational letter with utility bills once the new rates are finalized. The idea was suggested by Alderman Marcy Mumford.

“I will be putting a letter of information out with the utility bills once we figure out exactly what all of them are,” Nichols said. “I’ll write that… and explain to people what we’re doing, why we’re doing it, and the numbers that’s affecting what we’re doing.”

The mayor also reminded the council that the city has taken steps to reduce the overall utility burden on residents in recent years, including the elimination of a 4.5% utility tax in 2021, which he said saves the average household $15 to $18 per month.

City Attorney Tracy Willenborg is expected to draft an ordinance reflecting the proposed electric rate change, which the council will vote on at a future meeting.