Wednesday, October 19, 2011

Utilities spending for 2012: 8.6 percent increase

Posted By on Wed, Oct 19, 2011 at 10:56 AM

Boosted by rate increases for gas, electric and water, Colorado Springs Utilities plans to spend 8.6 percent more next year than this year.

The 2012 proposed budget, to be unveiled today at the Utilities Board meeting, is $1,110,677,000, or $87.8 million more than this year.

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"The two big drivers for the budget in 2012 are to improve air quality with the regulations we have to meet on Nixon and Drake power plants, and water supply for our future," Utilities spokesman Dave Grossman says.

Utilities recently announced a deal in which it will pay Neumann Systems Group $73.5 million for equipment the city helped test on the Drake plant over the past four years. The technology, which removes sulfur dioxide as required under new government regulations, will cost $39.5 million to install. The project is to be completed in 2014.

Construction of the Southern Delivery System, which began in 2010, will continue next year. Several contracts were recently awarded for pipeline construction, water treatment plant design and other facets of the project. Some are listed here:

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Water rates will rise by 12 percent in January, part of a multi-year increase to fund SDS. Utilities also has proposed an increase in gas and electric rates that would increase the typical residential bill by $3.27 a month. The gas and electric increases are to be considered by City Council next month.

When all increases are considered, the average residential customer can expect to see his or her utility bill go up by $8.22 a month, or 4.3 percent.

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