Eye On Modesto

Thoughts and observations about Modesto and Stanislaus County

Archive for the tag “electric rates”

Whose Electric Bill Are You Paying?

By Emerson Drake      stealingmoney

A short time ago we received MID’s response to a Public Record Request.  It contained the Kilowatt sales and  total revenue received by rate class from 2010 through 2014. The word total is important here because some rate classes have demand charges which are difficult to explain and for most of us, including me, to fully evaluate and understand.  So total means all revenue received with no exclusions.  For this conversation we’ll focus on 2014.

Detail                  kWh                  Revenues in $Millions                Cost per kWh

Residential      868,341                      156,132                                       .179                                                                                                                                                     Commercial     725,487                     105,539                                       .145                                                                                                                                                     Industrial        768,952                        79,797                                       .103                                                                                                                                                       Other               138,545                         18,403                                       .132

As you can see residential is paying 20% more than commercial and over 40% more than industrial for each kWh they use.  MID suggests the rate disparity is  because of the cost of service. When detailing the ‘cost of service’ it all depends on what costs numbers you count and what ones you ignore.   But interestingly enough most other utilities in Central California don’t have the extreme disparity.  Lets look at the numbers as a whole. MID likes to say using rounded numbers that each of the three big rate classes uses about one third of the electricity MID sells.  But as a total of revenue, Commercial generates about one third of the revenue that Residential uses and Industrial is little more than half.

When MID was pressed about costs back in June, by the Bee’s Garth Stapley,  the response was,  “The Bee asked for a demonstration showing how Netniss computed his profit estimate, using updated numbers, Van Vuren said it might not be possible, but we can get close.”  A few days later, Netniss declined.  He said that in November, he was trying to be helpful without considering journalistic intent.”  I would suggest it’s obvious not only do they NOT want scrutiny they refuse to provide information if it will be used against their goals.

So Why are 95,819 Residents Paying So 12,693 Business Accounts can Live High on the Hog?

Traditionally MID has been run by businessmen and farmers, yes I know farmers are businessmen, but their costs have been offset by the residential customers who have been paying a premium.  Recently a dairy farmer who pays the lower commercial rate commented that if people didn’t like what they were being charged “they could just shut off the switch.” Frito Lay who pays the lowest Industrial rate generates $2.2 Billion a year  in profits. And yes some of these profits are because they pay a lower rate than sick senior citizens on fixed incomes (the MID CARES program).

So Lets get Back to the Cost of Doing Business Argument

Just like in Mountain House it’s all about what costs you count.  In Mountain House they count basic infrastructure only.  They don’t count the cost of running the transmission lines or the transformer costs among others.  They only count the costs of running the lines from transformers to the street and then to the building site. For example in Beard Industrial Park they recently had to add a powerhouse and multiple transformers for the new area the City of Modesto approved and just as importantly, because of equipment failure they had to replace several very expensive transformers an older area of Beard.  These don’t count against “the cost of doing business.”

What is the most expensive time to purchase electricity?  In the summer, and when do you think most of the industrial power is used? You guessed it, in the summer.  Does this factor into the cost of doing business?  Not according to MID.  So according to MID, 164 industrial users use almost 1/3 of the electricity MID sells, yet only paid $79.7 Million of the $359.8 Million of the revenue MID generated.

The public is constantly being sidetracked by a conversation regarding water subsidizes but these costs are but a drop in the bucket compared to the amount of the electric subsidies residential ratepayers are forced to endure.


A Short but Contentious MID Meeting Today

By Emerson Drake

There was an early announcement saying agenda Item 8 was removed and postponed due to Glen Wild’s absence.  Item 8 being the one Allen Short is pushing to cast in stone what he calls past practices of the Board.  Unfortunately, at the end of the meeting the Board decided to insert a “special” meeting now scheduled for next week, which is before the two new Board members take their seats.


Board member elect Larry Byrd quietly asked the Board to consider delaying this particular decision until after the two new members take their seats in December.  The Board did not officially respond to his request.  After all Allen Short couldn’t tell them what to think, at least not in public.


The Board has been playing fast and loose with their past policy regarding the public comment period.  This is from their Agenda and is present on all of their agendas.


Public Comment Time: Because these are non-agenda matters, generally no discussion or comment by the Board should be expected, except to properly refer the matter for review as appropriate.  But no action will be taken at this meeting.


Yet for two weeks in a row the Board has waited until a member of the public has been seated before responding caustically.  While it’s nice to see the Board do something other than sit there stone faced, waiting until the audience member sits down to respond and then said audience member isn’t allowed to refute the Board member, General Manager or Board Council, doesn’t allow reasonable discourse.  If anyone on the dais decided to respond to input from the public, the public should be allowed to follow-up if they so desire. After all, this is the public’s meeting, isn’t it?  When I tried to follow-up on an issue, Paul Warda, MID Board President, warned me to remain silent or be removed from the meeting by an armed guard if any further outbursts were made.


Despite the claims of MID Board Attorney Tim O’Laughlin that a slur (suggesting that responses weren’t made on a timely basis) was made against his office regarding timely Public Information Request responses, a Public Information Request made four weeks ago during a meeting remains unanswered.


When it came to the matter of MID Board members not having their own email addresses, Cecil Hensley proudly told everyone he doesn’t even own a computer.  Thank you for your service, Mr. Hensley but personally I prefer someone I can get in touch with on a timely basis.  The only email address available to the public on MID’s website for the Board is board@mid.org  and it’s under the Board Secretary’s designation.


It’s obvious that citizens who wish to communicate with the MID Board are being inhibited and their concerns to the office holders that they elected, are being screened by Allen Short.


Board –Staff Linkage Policy BL-3 The Board Secretary shall: c) Receive and disseminate Board Communications.  This includes emails from the public which she gives to G.M. Allen Short just before the meetings and he passes out as meeting goers have witnesses time and time again.  Allen Short begged to differ regarding the email statement by the public but this item would seem to address the comment in its entirety.


For a long time now the Board, especially Director Tom Van Groningen has been misleading the public regarding the “special lower rate schedules” or discounts. These   discounts give lower rates to companies using off peak electricity they don’t offer to the public. And yet in turn the residential user foots the bill when an industrial user doesn’t cut back during peak periods. These discounts aren’t available to the residential electricity user, so in essence residential ratepayers have been subsidizing some of the businesses in the MID electric territory for some time now.


It looks like we’ll have to wait for the agenda to come out on Friday to find out if the Resolution regarding Board Governance Process and Board Staff-Linkage will be voted on.


But since approving the two resolutions are the main reason for the meeting, it appears the old Board will put its rubber stamp on Allen Shorts request.

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