BEU’s goal is to develop and adopt a series of electric rate designs that are based on cost-ofservice principles. The intent of the cost-of-service analysis and rate design evaluation is to: A. Perform a comprehensive review of BEU’s power system costs, allocations and categories; B. Assess customer characteristics and classifications; C. Design, then evaluate the impact of various rate structures and their impacts on customers, and D. Develop and produce a flexible non-proprietary working model that will be conveyed to the City of Banning and the public. The working model will be able to accommodate adjustments to factors such as integration of renewable energy sources; rising operating, maintenance and capital needs; stranded investments; normal to extreme weather patterns; overall sales, and customer demands. Each rate structure option will adequately balance BEU’s short and long-term financial sustainability. The proposed rate structure must meet the electric utility’s ongoing operating expenditures, bond covenants, capital improvement needs, debt recovery, and fund reserve requirements. It must also follow accepted industry standards, best practices and California Law. The recommended rate design will align policy goals with pricing strategies to encourage customer behavior that benefits the utility system...
