The office of Kentucky’s attorney general wants state regulators to reject Kentucky Power’s proposed rate increase.
The office of Attorney General Russell Coleman asked the Kentucky Public Service Commission in a filing Tuesday to reject Kentucky Power’s rate proposal.
“There is simply nothing fair, just and reasonable about continual rate increases that are not sustainable for the ratepayers,” wrote Assistant Attorney General Michael West.
Last month, Kentucky Power reached a settlement with two other parties that would reduce the impact of the increase. Instead of a 15% increase, electricity customers would see a 7% increase this year, followed by two smaller increases in the next two years.
That would lower the total increase to 12%. Still, Coleman’s office said that was not acceptable, citing the hardships expressed by residents at three public hearings.
Coleman’s office also suggested that the commission order an independent audit of Kentucky Power’s operations and decision-making.
The state attorney general is the de facto consumer advocate for customers in utility rate cases.
Coleman’s office has criticized Kentucky Power’s repeated rate increase filings at the PSC.
It has also slammed the company’s decision, more than a decade ago, to shutter coal generation in Lawrence County in favor of natural gas and half-ownership of the Mitchell plant in West Virginia.
Natural gas displaced coal as the nation’s dominant fuel for generating electricity a decade ago.
The retirement of coal generation at the Big Sandy plant in Louisa reduced employment and property taxes in the community, as well as took away a customer for the region’s coal.
Kentucky Power’s 20-county service territory in eastern Kentucky has broad economic challenges. A high percentage of residents live in poverty and struggle to meet their basic needs, including electricity.
In public hearings in Pikeville, Hazard and Ashland, residents spoke of owing unaffordable bills, turning to other sources of heat or moving to places with lower electricity costs.
The company has about 163,000 customers, and that has been on the decline.
The region has struggled to land big economic development projects. Two years ago, Century Aluminum seemed all but certain to locate a new facility in northeast Kentucky.
Last week, Century announced it would invest in another plant in Oklahoma instead. Kentucky Power has said no sites in its service territory were under consideration for the plant.
