Modesto Irrigation District cancels most June rate increases

The board of the Modesto Irrigation District voted 3-2 this morning to cancel most of an electricity rate hike planned for next month. The move will save a typical home about $6 in an average month.

The break will help customers suffering from the recession, Directors Cecil Hensley and Mike Serpa said. They voted for the reduction, as did Director John Kidd, who cited an unexpected increase in cheap hydropower this year.

Directors Tom Van Groningen and Paul Warda dissented. They said the reduced income to MID will threaten its strong credit rating, meaning higher interest on the bonds that finance capital projects.

The board had voted in November to raise rates in three phases in 2009. For residential users, that meant 7 percent in January, 6.5 percent in June and 5.4 in September.

The typical residential bill reached about $127 a month with the first hike. It will go to about $130 with the scaled-back increase in June, rather than the planned $136.

Because summer brings above-average power use for air conditioning, the savings will be especially big to start out.

The June rate increase was to average 7 percent across all customer classes, including residential, commercial and industrial. The average now is 2 percent.