Holton commission OKs first electric rate increase in 17 years

For the first time in 17 years, Holton’s basic electricity rates are going to go up.

During the Holton City Commission’s regular meeting on Monday, commissioners voted unanimously to raise the city’s electricity rates over the next two years in accordance with a recent Kansas Municipal Energy Agency study that proposed the raise in order to keep the utility financially viable.

The rate increase that goes into effect on April 1 will be about 10 percent for the current year, followed by another rate increase of about six percent in 2027.

Holton City Manager Teresa Riley said the increase on the monthly “customer charge” — the cost for an electric meter — and basic rate per kilowatt hour of electric use will take effect with the next billing cycle, which begins on April 1. An ordinance will be presented to commissioners for approval at their March 16 meeting, with publication of the ordinance to follow.

Commissioners had met with KMEA regulatory and rates manager Darren Prince at their Feb. 17 meeting to discuss the agency’s rate study for Holton’s electric utility, which speculated that if the city did not increase its electricity rates soon, the utility could be operating more than $2 million in the red by 2029.

That rate study involved four years of proposed rate increases, from 2026 to 2029, starting with an increase of about 10 percent for most Holton electric customers, whether they live or operate inside or outside the city limits, then lowering the annual increase on basic per-kilowatt hour (kWh) rates to about six percent.

Rather than run with KMEA’s entire four-year plan of rate increases, commissioners on Monday voted to go with the agency’s suggestion for the next two years, largely due to projected customer impacts being based on “forecasted information,” as Electrical Distribution Superintendent Corey Schuetz put it.

“If it looks like the numbers are not working, we can always come back and revisit it,” Riley said.

Commissioners also noted that city power customers would likely be unhappy that their rates had increased for the first time in 17 years and suggested that the rate increase should be made as small as possible.

“I would like to see us do anything we can to not raise them or raise them as little as we can,” Commissioner Mason Baum said. “Raising the bills is something that’s not going to make anybody happy. That being said, we also need to not go into the red either. So it’s a very tough decision to make.”

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