The Public Service Commission has ordered that a proposed rate hike from utility company Kentucky Power be cut down to a 5.66 percent increase.
That’s a significant cut from the utility’s original request, which would have increased the cost of their customers’ power bills by around 18 percent on average.
The rate hike affects around 163,000 Kentucky Power customers across 20 eastern Kentucky counties. It would increase the average resident’s bill by $8.32, assuming an average monthly usage of 1,200 kilowatt hours.
The company said the original request was because of a declining population and the closure of large business customers in the region, like AKSteel, AirGas and Our Lady of Bellefonte Hospital.
The PSC’s order called the potential impact of the originally proposed rate hike “excessive and disturbing.” The order also says public comment against the proposal from residents and county officials was considered.
“The Commission is concerned about the continued rising costs that the residential class is being allocated, and the ability of residential customers to shoulder greater costs, particularly without it further burdening the wider economy in the region,” the order said.
Sarah Nussbaum, Kentucky Power Corporate Communications Manager, says the utility is currently reviewing the order in more detail. Kentucky Power says the order resembles a previous settlement agreement with consumer advocate groups.
"As we continue to review the order, we're going to continue to work with all of our stakeholders and ensure that we're making the right choices for our customers, for the future of our company and for our ability to continue to invest in eastern Kentucky," Nussbaum said.
More customer assistance programs from the settlement agreement were approved by the Commission along with the new rate. That includes more contributions from Kentucky Power to its residential energy assistance program, and the creation of more energy efficiency programs for low-income customers. Billing due dates will also be extended from 15 days to 21 days.
Programs denied by the Commission include optional seasonal tariffs during wintertime and the construction of a new solar garden. Kentucky Power says both were meant to help with peak demand for customers. The Commission says the tariffs would further increase peak usage, while the plan for the solar farm is currently "premature".
