JEA customers face the potential for steep, double-digit increases in electric and water rates over the next decade if JEA clings to a “status quo” approach in the face of changes in the utility industry, according to a dire outlook given to the JEA board on Tuesday.
WJCT News partner The Florida Times-Union reports the base rate for electric bills would increase by 52 percent during that time frame. JEA could hold the base rate increase to 40 percent if the utility stopped making annual contributions to City Hall after 2023, which would blow a huge hole in the city’s budget, according to the report given by JEA administrators.
On the water side, JEA would either have to increase rates by 16 percent over the next decade, or use a 9 percent increase while eliminating financial contributions to the city after 2023.
The bleak forecast contrasts with JEA’s shorter-term outlook. The utility is not increasing rates for its 2019-20 budget. JEA has plans underway to build a new corporate headquarters building in downtown and a handful of solar farms across the city.
JEA and the city recently agreed to extend the annual financial contributions made by JEA through 2023 with annual 1 percent increases, reaching $122.4 million in the final year.
But JEA officials say the utility has gone through wrenching changes that continue to pose stiff challenges. The utility might need the City Council to change City Charter restraints on how JEA operates so it can enter new lines of business so the status quo projection “does not become reality,” JEA Chief Executive Officer Aaron Zahn said.
He said JEA will bring an action plan to the board in the future.
An expanded version of this story that includes a look at a potential source of future business for JEA is at Jacksonville.com.