The average bill for Louisville Gas & Electric electricity customers increased by $11 a month on Jan. 1, while Kentucky Utilities customers can expect to pay $18 more a month.
A settlement last month with Kentucky Attorney General Russell Coleman cut those amounts roughly in half. It has not yet been approved by the Kentucky Public Service Commission.
The commission is expected to issue a decision by Feb. 13. Once it does, customers of both companies may be due a refund.
“If the commission’s final decision is a lower amount than the proposed rates,” said Liz Pratt, a spokeswoman for LG&E and KU, “customers will be refunded the difference through a credit on their bill.”
The companies say they need to upgrade aging infrastructure, improve resilience in extreme weather events, and support new and expanding industries in Kentucky, including data centers.
The companies rely heavily on coal generation, including from Ohio Valley Electric Corp. plants in Ohio and Indiana. The OVEC plants have cost LG&E and KU customers tens of millions of dollars over market-priced power.
From 2018 to 2024, LG&E and KU customers paid $167 million more for OVEC power than they would have from the PJM market. That’s according to an analysis published in November by the Appalachia-Midsouth Newsroom.
Nationwide, electric utilities are scrambling to meet the demand for power from data centers and advanced manufacturing.
Meanwhile, federal policy has shifted from favoring renewables to supporting fossil fuels, including coal. The Trump administration wants to prevent the retirement of coal plants, and has used its executive power to keep several on the grid after they were scheduled to shut down.
The price of electricity has risen faster than inflation. Data centers may be driving some of that. The price of natural gas has also gone up, leading to an increase in coal generation.
The contract the region’s utilities have with OVEC runs until 2040, and utility analysts don’t expect the plants to become profitable. The Kyger Creek and Clifty Creek plants were built in 1955, making them older than the average coal plant.
LG&E and KU is a financial supporter of WEKU.
