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Cool Weather Means Loss Of Revenue For Local Utility Company

Updated: Thursday, July 31 2014, 09:35 PM CDT
SPRINGFIELD -- CWLP is a City of Springfield operated utility. Right now, it is suffering a loss in revenue  Part of that is due to upgrades, the other due  to the weather we have had this summer. At this time the city's budget director says he is not concerned.

Nearly $1 millions, that's the amount of revenue missing from the first quarter of the fiscal year from the CWLP electric fund.

"It looks like the electric budget is kind of tight right now that's because we had some one time expenses toward the refurbishment of Generation Power Unit #33," said Alderman Joe McMenamin.

CWLP officials also point out  a cooler than normal summer, with more people using less energy this time of year than last year.

The city of Springfield is unique since it owns it's own power plant, but just because the utility company may be in the red now it doesn't mean it will affect the city's  bottom line budget.

Budget Director Bill McCarty says utilities fall under a separate budgetary line item or  "utility" fund where CWLP  has to pay the city.

It is called, "payment in lieu of taxes" and helps funds essentials services to the City of Springfield. .

"Part of those funds end of coming to the corporate fund in the form of PILOT payment. The PILOT payment is a percentage of revenues from the utility that is paid to the corporate fund," said McCarty.

The corporate fund pays for things like police and fire protection. CWLP also can sell some of their extra energy on the open market, but that has proven problematic in the past.

"When the great recession happened in late 2008 and 2009 the price of electricity collapsed on the open market so we never got the price that we though we would," said McMenamin.

Despite the struggles, the city says the powerplant is still a cheaper alternative to a national supplier.

"We could control our own destiny and we have good local service," said McMenamin.

So what does loss revenue mean to consumers? Right now, CWLP says it's too early to tell.

As the weather fluctuates so does the cost of doing business. That means revenue can be made up in the remaining months.Cool Weather Means Loss Of Revenue For Local Utility Company

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