For months, the general manager of Gainesville Regional Utilities has told residents that by purchasing a $750 million biomass plant, the city could drive down utility rates by about 10 percent.

Now, the city-owned utility is projecting an increase in rates.

GRU will present its budget proposal for the fiscal year 2018 — October through next September — to the Gainesville City Commission today. The proposal includes a 2 percent increase in electricity rates starting October as well as projected increases through 2022, said GRU spokesperson Lauren Munsey.

Mayor Lauren Poe said the upcoming increases are the result of a major software update GRU plans to implement.

Poe, who serves as one of seven city commissioners, said the update would benefit GRU internally and allow for the utility to better serve customers online.

“This will allow us to be a 21st-century utility,” Poe said.

Poe said he and the other city commissioners will negotiate with GRU to work out the best rate for customers and should reach a tentative agreement on the budget — and on the exact percentage of the rate increase — by the end of July.

GRU and the City Commission still aim to offset rate increases through the possible buyout of the Gainesville Renewable Energy Center local biomass plant, Poe said. The city estimates that the buyout they’ve offered GREC, worth $750 million, would decrease rates for customers by about 8 to 10 percent.

“Any increase in rates is something that we want to try to avoid,” Poe said. “That’s why GREC is so important.”

Aside from the estimated 2 percent increase in electric utility rates set to start October, GRU also projects another 2 percent increase by 2020 and another 3 percent increase by 2022, Munsey said, resulting in an approximate 7 percent increase over the next five years.

At GRU’s public forum June 13 in Pugh Hall, utility general manager Ed Bielarski said while a GREC buyout would save some residents about 10 percent in electric utilities, others would see “as low as six (percent),” depending on where they live, according to Alligator archives.

On its “Why Buy GREC” website, the utility company emphasizes its focus on charging reasonable rates.

“Our main priority continues to be lowering rates for our customers, and we view (GREC) as a crucial step in the right direction,” GRU’s “Why Buy GREC” website states.

 

Staff Writer

David Hoffman covers crime and metro for The Alligator. A rising UF history and economics senior, the 21-year-old lives and breathes for classy Parks and Recreation references and watching live performances of the Red Hot Chili Peppers on YouTube.