The Lincoln Electric System Administrative Board and staff got several suggestions Tuesday night on how to deal with a $9.2 million budget shortfall due mostly to rising fuel and power generation costs.

The suggestions included investing in more wind turbine and other renewable energy projects, and raising electric rates even higher to force people to conserve energy.

One of the more intriguing ideas came from Beatty Brasch, executive director of Center for People in Need. She proposed that if LES implements a 10.1 percent increase, then low-income families should be exempt from that increase.

“The Census Bureau says there are 4,584 Lincoln families living at or below 100 percent of the poverty level,” Brasch told the LES Administrative Board. “If we exempt these families from the rate increase estimated to be approximately $8.50 per month, per household, the dollar amount would be $467,568.”

LES management is proposing a systemwide 10.1 percent rate hike due mostly to a volatile natural gas market. If approved by the City Council, the rate increase would take effect Sept. 1.  The city-owned electric utility passed on a 5 percent rate increase to its customers in March.

Tuesday night’s hearing was the first of two public hearings on the proposed rate hike. The LES board plans to vote on the measure Friday and will pass on a recommendation to the City Council, which has scheduled a public hearing for Aug. 18.

Ken Winston, a Lincoln attorney appearing on behalf of the Nebraska Chapter of the Sierra Club, urged the LES board to invest in more “green” projects that utilize wind and solar resources.

“We’re saying let’s invest in renewable energy. That’s a way to guard against rate shocks,” Winston said.

Tim Hemsath, with the Flatwater Chapter of the U.S. Green Building Council, suggested that LES get involved in constructing more green buildings in Lincoln and offer financial incentives to those who install renewable energy devices on their homes and businesses.

Todd Hall, vice president of consumer services for LES,  said the utility has been involved in an Energy Star program, which promotes energy-efficient homes, for the past 10 years. He said the utility supports green-build incentives but does not currently have such a program.

Instead of a regular public hearing, LES management used a  new format Tuesday night to create a “dialogue” with those in attendance. John Baylor, a former radio personality, served as moderator during the meeting attended by about 50 people. The new format appeared to work with customers speaking and asking questions and LES board members and staff  giving responses.

Coby Mack, with the Lincoln Independent Business Association, said his organization neither supports nor opposes the proposed rate hike. However, he said LIBA is concerned that that utility has not worked hard enough to reduce its internal costs. Mack suggested that LES reduce its matching contribution to the employees’ retirement fund.

 To lessen the impact of the rate increase, LES has proposed cutting its internal costs by $1.1 million. It also plans to use $1.5 million from its Rate Stabilization Fund.

Joyce Perry, a ratepayer, praised the board for doing an excellent job in keeping its rates down and instituting the new meeting format. She also encouraged the utility to look into alternative fuels.

Bob Caldwell, who represents the Lincoln Employers Coalition made up of some of the city’s largest power users, said his organization is not taking a position of support or opposition at this time. But his group did ask LES to, among other things, provide a line-item summary report outlying the cost reductions and efficiency measures related to the proposed rate increase.

Stuart Long, another ratepayer who attends LES meeting frequently, told board members that residential customers pay more for their electricity and subsidize other ratepayer classes. He also suggested that the utility boost its Rate Stabilization Fund to at least $20 million.

Roxanne Smith, a former member of the Lower Platte South Natural Resources District, told the board that no one likes to see their rates go up. She and others blamed a failed federal energy policy which relies heavily on oil  and not renewables.

“I support the rate hike to cover rising natural gas prices. I don’t want to see blackouts in Lincoln,” Smith told the board. “I encourage  raising rates even more to reduce (energy) consumption.”

Smith said citizens will not conserve energy on their own without higher electric rates. She also encouraged LES to get involved in planting trees. She said trees planted on the west side of homes help reduce energy bills by providing shade.

“I approve of the rate increase. In the future I look forward to more,” Smith said.

Reach Algis J. Laukaitis at 402-473-7243 or alaukaitis@journalstar.com.