Dover City Council holds a public hearing on its electric budget after signaling rate hikes in the city.
Dover City Council’s proposed budget includes budget cuts and an electric rate increase in order to close a $7 million deficit for Fiscal Year 27. Council finalized that proposal last month.
Though the proposed FY 27 budget would be balanced, questions still loom about the City’s future plans to ensure sustainable budget practices.
Dover Electric director Paul Waddell says costs aren’t getting any lower.
“So the last couple years I’ve come to you and I’ve said that we’re seeing increases in energy costs that we purchase from, and unfortunately that hasn’t changed. We are still seeing very high energy costs.” he said.
Waddell notes costs have come down in the real time market, but in the capacity and energy auction markets, prices continue to rise. He says energy expenses for the city are nearly 11-and-a-half times what they were just four years ago.
He says that most of that expense is simply the current energy market.
“For our expenses, we’re looking at an $86 million power purchase budget. That was initially brought to us by the energy authority to be $94 million. We did work with them and got that to curve back in a little bit based on our history of over-budgeting when it comes to power purchase which is not a bad thing.” he said.
Factoring in other expenses, that puts the proposed total electric budget at $110 million.
Waddell answered questions from Council on the electric departments spending habits, including where they're sourcing equipment from and who they're working with the reduce costs- he says that Dover Electric will purchase equipment from anywhere, including overseas, if they can save money on equipment.
Waddell says data centers being built in the region area also affecting prices,
"All utilities, especially public power utilities, are very concerned about data centers. The amount of load they consume can vary... if we were to have one come into our local area, my power purchase budget is going to have to increase accordingly" he said.
Concerns about data centers are rising as Kent County is proposing data center regulations, which would open the door to data centers in the area- including one already for proposed the Harrington area, in the former Harrington Logistics property.
Dover City Council will vote on adopting a budget during its June 22nd meeting.
