Title
RESOLUTION APPROVING DULUTH ENERGY SYSTEM’S THERMAL ENERGY HOT WATER RATE FOR EASTERN CANAL PARK.
Body
CITY PROPOSAL:
WHEREAS, that Ever-Green Energy, Inc. (“EGE”), the city’s manager of Duluth Energy Systems, has recommended an increase in the district heating hot water Energy Charge for customers connected to the eastern Canal Park hot water system from the current rate of $11.50 per million BTU to 70% of the Steam Consumption Rate plus $2.00 per million BTU for thermal energy service each month (estimated annual average rate of $12.96 per million BTU); and
WHEREAS, that the city has determined that such rate is reasonable and necessary to defray the costs of operating the subject system.
RESOLVED, that pursuant to Section 2.3.7 of the energy system management services agreement between the city and EGE, the city council hereby approves the Energy Charge at 70% of the Steam Consumption Rate plus $2.00 per million BTU for thermal energy services provided to customers connected to the eastern Canal Park hot water system, effective on and after January 1, 2023.
Statement of Purpose
STATEMENT OF PURPOSE: The purpose of this resolution is to approve modification of the Energy Charge for thermal energy services provided to customers (Canal Park Lodge, Canal Park Brewery, Hampton Inn, Inn on Lake Superior) connected to the eastern Canal Park hot water system from $11.50 per million BTU (MMBtu) to 70% of the Steam Consumption Rate plus $2.00 per million BTU for thermal energy service each month (estimated annual average rate of $12.96 per million BTU). The proposed 12.7 percent hot water rate increase is required to more equitably distribute Duluth Energy Systems’ operating costs between steam and hot water customers.