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first_imgRising demand for hydroelectric energy may boost revenues to the city Department of Water and Power by as much as $10 million and delay a planned request for a 3.8 percent water-rate hike next year, officials said Tuesday. Natural gas prices spiked after the Gulf Coast hurricanes, driving up demand for hydroelectric power and making the water that the DWP supplies to small plants more valuable. Officials estimate the utility could gain an additional $5 million to $10 million in revenue, which might offset the need for a water-rate hike. “As long as that’s up at that level, … the need for the rate increase has been reduced,” said Ron Deaton, general manager of the DWP. Deaton cautioned, however, that volatile natural gas prices could necessitate a power rate hike at some point. AD Quality Auto 360p 720p 1080p Top articles1/5READ MOREWalnut’s Malik Khouzam voted Southern California Boys Athlete of the Week The department plans hikes of 3.2 and 3.9 percent for each of the next five years to operate the water system, although the increases are on hold pending an outside financial review of the utility. Now the DWP is considering holding off on seeking the 3.8 percent hike planned for January. “To the extent that gas prices skyrocket, the revenue coming to the water system goes up,” said Robert Rozanski, the DWP’s chief administrative officer. But Rozanski cautioned that the revenue stream is unreliable because the water quantity depends on weather fluctuations. And natural gas prices, while currently high, can change drastically. Members of the Board of Water and Power Commissioners tied possible rate hikes to the increased scrutiny they have promised for the department’s spending. At a workshop Tuesday on the DWP budget, the commissioners sifted through the utility’s financial data and signaled their intention to trim nonessential spending. “Before we raise rates, and I speak for myself, we are going deep into that stuff,” said Commissioner Nick Patsaouras. Patsaouras requested more information about spending on marketing, public relations, lobbying, legal representation, subscriptions and sponsorships, while the commission president, Mary Nichols, pointed to a contract with a mediator that has lasted for 15 years. Deaton said that, as officials review such spending, there will be differing views of what is discretionary. For example, he said, he considers the lobbyists who represent the DWP in Sacramento and Washington to be essential. “What are the items you would be embarrassed by if you saw them in the paper?” Nichols said. “Those are what could be defined as discretionary.” Dan Laidman, (213) 978-0390 [email protected] 160Want local news?Sign up for the Localist and stay informed Something went wrong. Please try again.subscribeCongratulations! You’re all set!last_img

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