Lincoln Electric System's Board of Directors voted Friday in favor of its proposed 2025 budget, including a 3.3% rate increase.
Assuming the City Council approves it, the increase will be the third straight one after LES went five years without raising its rates. The utility hiked rates 4.8% in 2023Ìý²¹²Ô»åÌý3.7% this year.
While the overall rate increase is 3.3% and that is the average increase residential customers will see, the increase is different for different classes of customers, ranging from 2.1% for large power customers to 10% for those in the heating service class.
For most residential customers, the increase will add up to about $3-$4 a month. LES said an average residential customer using 1,000 kilowatt hours per month will see an average increase of $3.50 a month.
The board vote was not unanimous. As she has the past two years, Chelsea Johnson again voted against the overall budget and the rate increase.
She said she believes LES's continued shift to make its rate structure more reliant on fixed costs disincentivizes conservation and also makes it more difficult for people to lower their bills by being more energy efficient.
Emily Koenig, LES's vice president of financial services and chief financial officer, said the utility received "not many comments, really," on the rate increase, and only four people attended its public budget meeting.
LES also had meetings with business groups and some of its large customers.
"I wouldn't say that there's been much negative feedback that we've received," Koenig said at Friday's board meeting.
Ken Winston, director of policy and outreach at Nebraska Interfaith Power & Light, was the only person who testified at Friday's meeting.
While Winston expressed some concerns about the effect of the rate increase on low-income customers, he said he appreciated, "the effort to keep the LES rates low."
Compared with cities in the region such as Omaha, Des Moines, Kansas City, Wichita and Denver, LES will still have the lowest residential rates on average after the rate increase and among the lowest rates for commercial and industrial customers.
The rate increases will help to fund a proposed $474.8 million budget, which is considerably larger than last year's budget due to a change the City Council approved earlier this year to the method LES uses to account for capital expenditures.
Essentially, the change authorizes LES to include in the 2025 budget capital expenditures on any project that will be started in the next two years, through the life of the project. Koenig said LES actually plans to spend slightly less on capital projects in 2025 than it did this year. Its operating budget is proposed to increase 2.8%, from $283.2 million this year to $291.1 million next year.
The City Council is scheduled to hold a public hearing on the proposed budget and rate increase on Nov. 4 and then vote on Nov. 18.