BY JAMES WERNICKE
Los Alamos

Dear Philo,

When you say everyone is feeling the weight of rising utility costs, I have to ask why so much of that weight is being passed on to customers rather than being addressed through greater accountability and efficiency within DPU.

Section 504 of the Los Alamos County Charter requires utility rates to be just, reasonable, and comparable to those in neighboring communities.

You say declining consumption has reduced DPU’s ability to recover fixed costs. That’s because there is no such thing as fixed consumption. People buy more efficient appliances, turn down their thermostats, and make sacrifices to control their expenses. Weather is unpredictable. You could choose to recover fixed costs through monthly connection charges, allocated according to each customer’s actual share of those costs. Why should customers be responsible for the consequences of DPU’s choice to recover fixed costs through variable consumption? What responsibility does management bear?

Section 504 of the Los Alamos County Charter requires utility rates to be just, reasonable, and comparable to those in neighboring communities.

You use a tiered system to encourage conservation, but higher consumption does not inherently mean a higher cost per unit of service. Often, economies of scale produce the opposite result. What evidence justifies charging customers more per unit simply because they consume more?

Why does DPU offer preferential rates to County and school customers without extending comparable consideration to other nonprofit institutions serving our community?

Section 504 of the Los Alamos County Charter requires utility rates to be just, reasonable, and comparable to those in neighboring communities.

Why does DPU charge natural gas customers roughly 35% more than neighboring for-profit utilities? What specifically accounts for the price difference? How much of the difference comes from purchasing and transporting natural gas to Los Alamos? How much comes from local distribution, staffing, administrative overhead, maintenance and replacement, and financial reserves? If Los Alamos is genuinely more expensive to serve because of geography, system size, or infrastructure age, why don’t you quantify those factors rather than simply invoke them? Where are the comparative figures for operating expense per customer, staffing per 1,000 connections, maintenance expense per mile of pipeline, and administrative overhead as a percentage of revenue?

You cite pipeline safety compliance, additional documentation requirements, tracking software, and increased gas transportation charges as reasons for raising rates. How much do each of those requirements cost and how do those costs compare with the regulatory compliance costs faced by NMGC and Zia?

How much of the money Los Alamos residents pay for natural gas actually goes toward delivering natural gas, and how much is used to support other County functions? What portion of franchise fees, payments in lieu of taxes, shared administrative overhead, and revenue transfers are attributable to gas customers?

Where is the independent analysis demonstrating that these additional expenses are necessary and reasonable? What cost-reduction measures were evaluated before increasing rates, and what measurable efficiency improvements has management delivered?

Section 504 of the Los Alamos County Charter requires utility rates to be just, reasonable, and comparable to those in neighboring communities.

How does DPU demonstrate compliance with that requirement when neighboring customers pay substantially less?

DPU’s Utility Assistance Program distributed approximately $26,500 in FY2025. Meanwhile, LA Cares provided $30,924 in utility assistance to 74 local families with an administrative overhead of just 4%. What is DPU’s overhead to distribute each dollar of utility assistance? If DPU is not delivering assistance more efficiently than local nonprofits, how do you justify that if DPU is vertically integrated?

Why did DPU agree to pay $37.88/MWh for Foxtail Flats solar power when PNM secured a comparable 20-year solar agreement at $29.84/MWh? And how does Foxtail’s $13.50/kW-month battery storage contract compare with other regional storage projects? Where is the independent analysis demonstrating that this was a competitive deal?

Finally, public payroll records show that your compensation reached approximately $259,000 in 2024, substantially exceeding the pay offered by many comparable municipal utility management positions. Why should residents accept such exceptional executive compensation without equally exceptional accountability?

Section 504 of the Los Alamos County Charter requires utility rates to be just, reasonable, and comparable to those in neighboring communities.

You ask the community to understand the financial pressures facing DPU, but where is the evidence that management is exercising the same financial discipline it expects from customers?

Before asking residents to pay more, why shouldn’t we expect DPU to demonstrate that it is doing everything reasonably possible to spend less?

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