Austin’s natural gas and water rates will increase in 2017, following approval by the Austin Utilities Board of Commissioners.

The water rate will increase by 4.9 percent and natural gas will go up 3 percent. The rate changes will become effective with the January 2017 utility bill.

The overall rate adjustment will result in an average bill increase of $3.06 per month for residential customers. About 85 percent of Austin Utilities current customers are residential.

Small to mid-sized business customers can expect to see increases in the range of $13-$45 per month.

All adjustments were made due to the continued need to bring aging utility infrastructure up to date, according to a press release.

The increases are part of the 2017 utilities budget approved at the board’s regular meeting on Dec. 13.

Utility staff confirmed the need for rate adjustments through a study performed in September 2016.

“We understand the financial impact these increases have on our customers, and we are working hard to keep costs down,” said General Manager Mark Nibaur. “Reliability is the number one concern of our customers and keeping our infrastructure up to date allows us to provide reliable service.”

One major project driving the water rate increase is the rehabilitation of Well House Number 9, also called the Belair Well house, which was originally constructed in the 1950s. A new building was needed to comply with new Minnesota Department of Health and Building Codes. Additionally, necessary replacement of distribution lines, dating as far back as the 1930s, and located in various areas of Austin, is an additional project driving rate increases.

With the exception of a few months, customers have been seeing a credit on their monthly bill in the form of a natural gas cost adjustment since October 2006. A 3 percent increase will shift costs to the base rate and monthly customer charge.

There will be no increase in electric rates but an adjustment will be made between the customer charge and energy charge.

Customers will see a change as costs are shifted from the energy charge to the customer charge. This is to allow the utility to fairly recover distribution costs from all customers.

The “customer charge” is a set charge regardless of energy usage. This charge covers the cost to maintain facilities and infrastructure to continue supplying customers with reliable service. This charge can include items such as meters, distribution poles, piping, safety equipment, miscellaneous supplies, and account administration.

As a consumer, there are several steps that can be taken to ensure energy dollars are spent wisely. Austin Utilities Conserve & Save rebate program offers a full range of rebates on equipment designed to help customers reduce their energy bills.

Contact Austin Utilities Energy Service Department at 507-433-8886 for more information. Customers may also be eligible for budget billing which allows for even payments each month.

Austin Utilities is a municipal utility serving approximately 12,300 electric customers, 10,300 natural gas customers, and 9,000 water customers. For more, visit the utility’s website, www.austinutilities.com.