The Pella City Council will receive an update on power supply costs at their meeting Tuesday night.

During the policy and planning section of the meeting, City Administrator Mike Nardini will review a notice from Missouri River Energy Services (MRES) to the city about an increase in power supply costs by approximately 2.5% effective January 1st, 2024. In addition, the notice from MRES forecasted that power supply costs will increase 5% annually from 2025 through 2028. No formal action on the matter is scheduled for this week after the update. The rates used in this forecast were not adopted by the MRES Board, but rather the forecast was intended to notify members that power supply rates would likely be increasing in future years.

In analyzing the 2024 rate increase, city staff believes that the current electric rates will not need to be adjusted. The council can enact an Energy Cost Adjustment (ECA) for power supply and transmission costs in excess of $77 per megawatt hour. According to city staff calculations, they believe the city’s projected power and transmission costs in 2024 will be approximately $70 per megawatt hour, which includes the MRES increase. As a result, city staff does not believe it will be necessary to enact the ECA for 2024, but future power supply increases will need to be evaluated on an annual basis. The City of Pella has maintained its current electric rates since 2012.

The Pella City Council meeting begins at 6 p.m. Tuesday in the Pella Public Safety Complex.