Redding Electric Utility’s residential customers could see their rates go up over the next four years starting April 1.
REU officials say the increase in monthly rates are driven by a host of mounting expenses for the city-owned utility related to supplies, inflation, state rules, infrastructure maintenance and management of overgrown vegetation and equipment to prevent wildfires.
The costs are in the millions and would be passed on to REU customers in a proposal that raises only the residential rates by 4.5% annually through April 1, 2029. Then, in 2030, rates would increase by 2%.
Monthly residential rates went up by $3 in 2023, $6.75 in 2024 and $7.75 in 2025. If the new REU initiative passes, monthly rates could increase by $7 as soon as April, an addition of $24.50 to utility bills since the most recent rate increases kicked in in 2023.
For income-qualified REU customers, rates would only increase by 1.7% annually as a result of the Residential Energy Discount Program.
Ahead of a March 3 public hearing before the Redding City Council acts on the rate increases, REU will hold two open houses to go over the rate increases with customers. Both public workshop are scheduled for Feb. 26, one at noon and one at 5 p.m., at the Redding City Hall Community Room, 777 Cypress Ave.
Not all council members were in favor of considering the proposed rates.
Councilmember Tenessa Audette at the Feb. 17 City Council meeting cast the lone dissenting vote, 4-1, against holding the public hearing.
Audette noted that a presentation by REU director Nicholas Zettel did not factor the increased cost of personnel overtime. That accounted for an increase of about $9 million “from the last budget,” according to a financial report to the council.
Joe Bowers, assistant director of resources, told the Record Searchlight that the $9 million increase represents updated pay and benefit packages approved in 2023, after the fiscal year 2025 budget was approved by city council. Those agreements are now retroactively accounted for by the $9 million increase from the fiscal year 2025 to fiscal year 2027 budget, along with other “relatively small changes.”
Audette also asked Zettel to provide statistics regarding the increase in personnel costs to the public, which the two agreed to discuss in more detail privately.
Mayor Mike Littau emphasized that more detailed financial information will be provided at the scheduled public hearing.
So what drove REU’s costs up and by how much?
Zettel said the rate increase was consulted on by a community panel that included the senior director of organizational communications at the Redding Rancheria, Miranda Edwards Favorite, certified public accountant and former finance director of the city of Shasta Lake, Kurt Swanson, vice president of the Community Revitalization and Development Corporation, Shelby Marocco, president and CEO of the Redding chamber of commerce, Todd Jones, and a board member of North State Climate Action, David Ledger. Zettel said that REU had initially approached the panel with a 4% annual rate increase plan, but the panel suggested REU up the rate increase to 4.5% to account for emergency situations such as a drought or disaster.
Corrections & Clarifications: This story was updated due to incorrect information the Record Searchlight initially received from Redding Electric Utility about what caused a $9 million increase in its budget, which Councilmember Tenessa Audettte contended was related to personnel-based expenditures. REU’s Joe Bowers clarified the expense retroactively reflects pay and benefit packages tied to labor contracts that the city council approved in 2023.
Drew Askeland covers Redding and Shasta County government issues, as well as anything else that needs reporting for the Record Searchlight and USA Today Network. Reach him at drew.askeland@redding.com or (530) 225-8247. Please subscribe today to support our newsroom’s commitment to public service journalism.
This article originally appeared on Redding Record Searchlight: REU rates could go up again starting in April. What to know
Reporting by Drew Askeland, Redding Record Searchlight / Redding Record Searchlight
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