When it comes to trends in public consumption, electricity and water use numbers often paint a picture.
Year-to-date in the Electric Division — which includes January, the middle of winter when electric sales are generally up, but water and wastewater sales are down — sales volume rose by 1.3 percent. And specifically for January, the Water Division reported an increase of 7 percent, and the Wastewater Division flow was up by 11 percent.
As a public utility with bills to pay of its own, Cleveland Utilities is like any household or business. It relies on revenue to operate in the black, and revenue comes from electricity and water users.
As is part of his monthly report, Webb announced the residential retail electric rate for the coming month. Based on purchased power cost from TVA, CU customers in March will pay 8.639-cents per kilowatt-hour, compared to 8.781-cents in February.
In January, the Electric Division provided service to 29,886 customers with the average retail price of electricity being 9 cents per kilowatt-hour. For the month, CU sold 92,705,418 kilowatt hours.
During this period, division revenue was $8,304,646, leaving a margin of $1,413,706 for the month.
“The cost of wholesale power, stated as a percentage of revenue, was 83 percent which is one-half of 1 percent lower than was budgeted for the month,” Webb told members of the Cleveland Board of Public Utilities in a recent monthly gathering. “This is a turn in the right direction which I hope will develop into a trend as this number has not been this favorable in several months.”
Other revenue items in January contributed $131,500. Expenses ran slightly over budget at $1,413,844, leaving a net income of $131,351. The latter number also was under budget.
“As I have been reporting for several months, the year-to-date results in electric continue to trail behind the original expectations for Fiscal Year 2013,” the CFO explained. “The margin between sales revenue and purchased power is lagging behind approximately $770,000 from the budget.”
He added, “Over half of this is from the higher-than-anticipated cost of purchased power. I’m hoping the improvement we have seen in January is a sign the trend will improve.”
Year-to-date, the Electric Division has sold 639,602,201 kilowatt-hours with a net income result of $718,901.
“Volume is up 1.3 percent from the same period of time in Fiscal Year 2012,” Webb noted. “Sales to industrial customers accounts for the majority of the increase.”
Webb told the board he is “pleased” to report that sales volume in the Water Division is even better than anticipated.
For January, sales volume totaled 213,189,750 gallons, representing a 7 percent increase over January 2012. Water service was provided to 30,156 customers at an average retail price of $4.45 per 1,000 gallons.
This revenue, plus all other sources, tallied $1,044,046 for the month.
In a related development, access fees totaled $27,355, almost doubling the projected amount. An access fee is the amount paid by a builder, contractor, developer or customer to have new structures connected to CU’s existing water system. New construction is a gauge of a community’s economic viability. So, rising access fees could be construed as a rebounding economy, according to Webb’s report.
Water Division expenses in January totaled $1,043,098, leaving a net income of only $948 for the month.
“On the surface, this does not look like an encouraging amount, but the projected result was a $57,873 loss,” Webb said. In other words, sometimes — even with utility sales volumes — numbers are a matter of perspective.
The Water Division’s YTD net income is $576,969. The projected amount in Webb’s budget was $428,607.
“I am encouraged by us being in this position at this time in the fiscal year as we still face the springtime months,” he noted. “These months can, and sometimes do, have wide fluctuations in weather that can have a significant impact on the demand for water.”
The YTD access fee amount is $150,475 through January.
“This is better than both the projected amount and the amount at the same time last year,” Webb stressed. “I continue to believe this is a good sign of development and building in the area.”
Webb pointed out the results in sewer for the month flow along the same pattern as that established in its water-based sister division. In January, sales volume hit 149,685,750 gallons which is up almost 11 percent. He said five of the six customer classifications in sewer recorded increased volume. The average retail price was $5.50 per 1,000 gallons.
Sewer revenue for the month was $909,369, with expenses coming in at $833,053. This left a net income of $76,316 for the month.
“These results are very encouraging at this time of the year,” Webb said. “The projected net income for January was $8,093.”
The YTD results in sewer are showing a net income of $546,100. Volume through January is up about 1.5 percent, he noted.
“Just as in water, access fees in sewer are greater than at the same time last year, and greater than the projected amount through the first seven months of Fiscal Year 2013,” Webb said.