NBU NEWS RELEASE

FOR IMMEDIATE RELEASE: April 25, 2006
Contact: Gretchen Reuwer, NBU Communications Manager, (830) 629-8486

NBU to propose electric rate decrease

NEW BRAUNFELS—NBU electric customers could be benefiting from a rate decrease in the near future. The NBU Board of Trustees will consider reducing rates in total by an average of 2.3% during their regular meeting on Thursday, April 27. If approved by the Board and the New Braunfels City Council, the decrease will be reflected in the summer rates which are in effect from June through September.

“NBU recently completed a cost of service study that looked at all the costs associated with serving our customers,” NBU CEO Paula DiFonzo explains. “We undergo these studies on a routine basis to ensure that our rates continue to be set appropriately and fairly. Because of efforts to reduce costs and revenue requirements, we are able to recommend an overall system rate decrease.”

The Small General Service class, for instance, will see an average decrease of 6.9% in rates while the Large General Service and VLP classes will benefit from average decreases of 1.3% and 10.8%, respectively. The recommendation also includes an average decrease of 1.9% in rates for the residential class. The study advised an increase in the residential customer charge from the current $10 per month to $14.50 per month and a reduction in both summer and non-summer energy charges. With the increase in the customer charge and the decrease in the energy charges, customers averaging 951 kWh or less on an annual basis will see a slight increase in total cost, while those with usage above that amount will see a decrease as the fixed costs are spread across more kilowatt hours.

“The monthly customer charge for residential, small general service, large general service and industrial customers is in place to recover some of NBU’s fixed customer costs,” DiFonzo says. “These are costs—such as a portion of electric system facilities, meter reading, billing and services associated directly with the customer—that do not vary with kilowatt hour energy and are incurred regardless of how much energy is consumed by customers. The monthly customer charge helps reduce NBU’s dependence on energy sales to recover fixed costs on a per kilowatt hour basis.”

The current base rates for residential customers—which do not include the Power Cost Recovery Factor—are $0.0745 during the summer months of June-September and $0.0617 during the winter months of October-May. The proposed decreases will drop these rates to $0.0679 in the summer and $0.0579 during the winter. An example of how summer rates will be affected by the revised customer charge and lower rates as compared to the current customer charge and rates is shown below:

NBU continues to emphasize the importance of conservation in helping to lower energy bills year round and offset these increases. Free energy audits are available to help customers identify areas in their homes and businesses where greater energy efficiency can be achieved. Customers are also encouraged to take advantage of the NBU Budget Billing Program and obtain free Energy Saver booklets at the Main Office. For more information about any of these programs and services, please call the NBU Customer Service Division at (830) 629-8400.