GRU Authority takes first look at FY2026 budget, plans to hold electric rates flat
BY JENNIFER CABRERA
GAINESVILLE, Fla. – At their April 3 meeting, the GRU Authority took a first look at its FY2026 budget and heard an update on debt repayment; staff recommended holding electric rates flat. The Authority also voted to appeal a judge’s ruling on the City’s referendum to regain control of the utility; click here for that article.
Budget presentation
In her presentation, Rates and Budget Manager Karen Fiore said GRU’s revenue growth is only about 0.5% per year because consumers have been “conserving our natural resources, which translates to lower usage.” She said the area’s “minimal population growth” and more efficient appliances are also contributing to the slow growth rate.
Fiore recommended no increase in base rates for electricity, a 1.75% increase in water rates, and a 1% increase in wastewater rates. She plans to present the final budget to the Authority in May, and the board will set the actual rates for FY2026 at that meeting.
CEO Ed Bielarski said that to keep electric rates flat in an environment with revenue growth below the inflation rate, “you’d better become efficient, you’d better watch your pennies, and you’d better do a good job on the expense side of the equation.” He said that data centers and expansion of natural gas are new revenue possibilities that would have previously been “hamstrung” by the City Commission.
Bielarski said this focus on reducing expenses and seeking out new revenue sources contrasts with “the way we used to operate, [which] was, ‘Hey, we need a 3% increase in our expenses, and we need a rate increase.’… And now, as we exist with the ability to pay a General Fund Transfer we can afford, all of a sudden, all the components of our business are coming together.”
Director Craig Carter said, “What I take from that, Mr. CEO – you’re saying this organization, this business, is tightening its belt before we ask our customers to tighten their belts.”
Debt repayment
Chief Operating Officer Tom Brown gave a presentation on GRU’s efforts to reduce its debt; the debt portfolio is $1.8 billion. Strategies such as refinancing, defeasance, and refunding have reduced future payments by about $1 billion since 2017.
Brown said that once all of the natural gas prepayment transactions are in place, they are projected to save $4.63 million a year. A recent bond swap covering the period 2027 through 2040 is projected to save about $26 million over that period of time.
The focus on reducing debt has accelerated since the GRU Authority took over governance of the utility and is on track to reduce debt by $395 million by 2035 while simultaneously reducing bills for customers. According to an April 3 release from GRU, a 1,000 kWh residential electric customer pays approximately $20 less per month today than they did in October 2023 and $46 less than October 2022.
Bielarski pointed out that the gas prepayment won’t necessarily prevent the fuel adjustment from going up if natural gas prices increase, but it might reduce the increases in the fuel adjustment.
State of the utility
Deerhaven Renewable (the biomass plant) has been back online since February 4 except for a six-day outage at the end of March for a boiler tube leak, and 87% of the electrical AMI meters have been installed.
Transitioning to becoming a TEA partner instead of member
Bielarski said that GRU has been a member of The Energy Authority (TEA) since 1998; TEA provides services such as trading, analytics, and resource planning. GRU has a small equity position in TEA worth about $11 million and has put up guarantees of about $46 million over time; Bielarski said that switching from a member to a partner position could enable the utility to cash out the $11 million and release the $46 million in risk. He concluded, “As a vendor, they’re good, but there are other options as well.” He recommended that the Authority allow him to negotiate moving from member to partner or sourcing another option for natural gas and power services.
Carter made a motion to “empower the CEO to look at avenues and negotiate with The Energy Authority and bring back a report in May with recommendations.” The motion passed unanimously.
Bielarski : Are the storm water fees going to be removed from ratepayers GRU bills and shifted to property taxpayers? This means rents will be going up to cover the change.
Big Daddy Eddy B you are doing it wrong. When the Commission was ruining, I mean running, GRU we were constantly raising rates and fees on the underlings we rule over. This was the only way we could fund our wasteful spending. You are doing it all wrong we are here to take from the commoners not to actually work for them. Now you just wait and if the courts give me back my piggy bank (aka:GRU) I will show you suck money out of our sheeple.
Reducing debt by $395 million over the next ten years seems like an awful slow payment plan.
The city commission’s plan was $315 in 10 years, and that required electricity rate increases every year through at least 2027: https://alachuachronicle.com/gainesville-city-commission-cuts-transfer-from-gru-to-city-requiring-budget-cuts-of-about-19-million/
Time to give feminists what they really need and legalize prostitution. Put Hanrahan out on the street, all proceeds go to cover the GRU debt. 10% goes to planting trees to offset the carbon that she’s still breathing out.
We need GRU back with the citizens so we can fund the chestnut football complex, buy electric busses, trollies, more ambassadors, more hotel buy backs for homeless,etc,etc
Rates and Budget Manager Karen Fiore said GRU’s revenue growth is only about 0.5% per year because consumers have been “conserving our natural resources, which translates to lower usage.” She said the area’s “minimal population growth” and more efficient appliances are also contributing to the slow growth rate.
More likely they’ve been doing all they can to prevent their utilities from being turned off due to the high costs. Don’t know where she’s been looking, but by most appearances – apartments everywhere, traffic congestion, and new home construction; there hasn’t been much abatement in the numbers I’ve been seeing.
I invite anyone to view the GRU Authority meeting of 12/6/23 @ 2hr/20min. and see that the unknown SLA (Service Level Agreement) losses were not disclosed on the FY 24 GRU Audited Financial Statements.
This board is an utter disappointment… as someone that was excited to see it come; I now feel the grass was greener on the other side.
Bielarski said this focus on reducing expenses and seeking out new revenue sources contrasts with “the way we used to operate, [which] was, ‘Hey, we need a 3% increase in our expenses, and we need a rate increase.’
– Guess that Ed is hoping that people forget that he was the GM for ~7 years prior to his exile and was the one that did exactly that throughout his tenure.
“He said that data centers and expansion of natural gas are new revenue possibilities that would have previously been “hamstrung” by the City Commission.
– What data centers? This is a hugely unlikely situation considering GRU’s location, climate, distance from high capacity fiber trunk connections, and taxes. What additional revenue opportunities? Ed couldn’t close a gas deal (or frankly, any other deal) with several nearby potential customers that desperately wanted service. The only “deal” on his watch was in overpaying for a biomass plant.
– Where is there an earmark for implementation of the electric Integrated Resource Plan, which he stated GRU was taking steps to implement. It appears that he is “kicking the can down the road” for the next GM to deal with.
In short, Ed is totally full of BS.
ABSOLUTELY Spot On. Bielarski is part of the self-serving “leadership” that prolongs the mess GRU is in. The highest paid CEO in GRU history and he’s just running the clock, with no plan explaining how the utility will fund the replacements of its generation fleet needed in the next 10+ years nor sharing with employees what the plan even IS if there is one. Read GRU’s Ten Year Site Plan filed with the Florida PSC. Lots of words there, no communication with employees on how the utility plans to fund the generation replacements nor word of firm power transactions that the utility could secure to meet load obligations. Had high hopes for Ed, so disappointed, another executive self-aggrandizing at the expense of the rank and file employees. File a public records request for the plan that replaced the IRP. Does a plan exist? File a public records request for employee benefit decreases implemented just two months ago. GRU used to be a great place to work and to be proud of belonging to, now it is a shame.