Published: April 07, 2009 12:30 pm         

Electric bill for RECC customers to increase

Monticello — Electric bills for South Kentucky RECC customers will increase by an

average of $6.13 a month, because of a recent rate increase approved for

East Kentucky Power, which is the wholesale provider for the local rural

cooperative. According to a statement released last week, the rate increase

for East Kentucky Power will result in a pass-through rate increase for the

entire South Kentucky RECC membership.

It became effective April. 1.

"We understand our members are facing rising costs, so South Kentucky

RECC is doing all it can to hold costs down while providing reliable,

affordable power to our members," stated Allen Anderson, CEO of South

Kentucky RECC.

East Kentucky Power sought the rate increase in order to recover the

costs associated with a new $528 million generating unit and to ensure that

the cooperative continues to meet its financial obligations. The new power

plant is needed to meet increasing demand for power among the members of the

Kentucky cooperatives.

In a statement released on March 31, the Public Service Commission (PSC)

stated that it had accepted a settlement that permits East Kentucky Power

Cooperative to raise its wholesale rates in order to increase its annual

revenues by $59.5 million, or about seven percent.

East Kentucky Power negotiated the settlement‹which gives the generation

and transmission cooperative $15 million less than the amount of additional

revenue it said was needed‹with the Office of Attorney General and the

Kentucky Industrial Utility Customers, Inc. (KIUC).

East Kentucky Power applied to the PSC for the rate increase on October

31, 2008. During the course of the PSC's examination of the application, the

utility, the Attorney General and KIUC began settlement negotiations. The

settlement was submitted to the PSC for review on March 13. A public hearing

on the proposed settlement was held March 27.

In the order issued by the PSC, the rates contained in the settlement

were deemed "fair, just and reasonable."

South Kentucky RECC and East Kentucky Power are both not-for-profit,

member-owned cooperatives based in Kentucky. The rates of both cooperatives

are regulated by the PSC, a government agency that oversees utilities in

Kentucky.

"This rate increase is a direct pass-through for South Kentucky RECC. We

will not benefit financially from this rate increase," stated Anderson. "We

want our members to know that we understand how much financial stress they

are under in today's economic climate. Both East Kentucky Power and South

Kentucky RECC are trying to do everything we can to reduce costs to prevent

rates from increasing any more than are absolutely necessary and we will

continue to do so."

"At South Kentucky RECC, we are happy to assist our members in using

electricity more efficiently. Even though rates are being adjusted due to

necessity, members may be able to keep their costs about the same or even

possibly lower them by implementing energy efficient improvements or

practices in their homes and businesses. Members may contact any of our

energy advisors at our five locations for assistance," added Anderson.

     

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