A hearing in front of the Public Service Commission that could see utility costs for around 163,000 Kentucky Power customers in 20 eastern Kentucky counties increase by 11 percent begins this week.
The hearing comes after weeks of public comment hearings around eastern Kentucky. Kentucky Power’s request to the Public Service Commission was originally submitted last May.
Testimony from Kentucky Power says that the proposed rate increase reflects a declining population and the closure of regional job creators like AKSteel, AirGas and Our Lady of Bellefonte Hospital.
But it also comes with cost-of-living concerns in one of Kentucky’s poorest regions. A report from the state Energy and Environment Cabinet says Eastern Kentucky already has some of the highest utility bills in the state.
Letcher County Judge Executive Terry Adams said during the Tuesday hearing’s public comment period that an increase could pose a problem for his constituents living on fixed incomes.
“I know there's a profit margin that has to be made by a company, but to put that on the backs of people that already can't pay the bills is not acceptable,” Adams said.
Catlettsburg resident Suzanne Barker Griffith also said during the public comment period that she’s seen locals ask for help with bill payments at the food bank she helps run.
“The look on some of these people's faces who have never asked for help in their whole life has really shook me to my core,” Griffith said.
Kentucky Power President and Chief Operating Officer Cynthia Wiseman said they’ve been working to accommodate those customers during the hearing.
“We plan accordingly, looking for the least-cost option for our customers and everything that we do - economic development, certainly,” Wiseman said. “The efforts that we put forth in our community support are mostly going toward housing and hunger.”
The original proposal would have increased the average utility bill by around 18 percent for each customer. A settlement between Kentucky Power and consumer advocate groups reduced that number to its currently proposed 11 percent increase.
Amethyst Muncy represents Appalachian Citizens Law Center, one of the case’s defendant intervenors. The agency helped negotiate more benefits for low-income Kentuckians to help them pay their bills, if the new rate is approved.
“It's a balancing act, trying to consider what would actually come out of not agreeing versus what would come from agreeing to a settlement,” Muncy said. “Because there are some things that you get in a settlement that the Public Service Commission can't require from the power company.”
Kentucky Power says it’s doubling its contribution and adding 2,000 more customers to its residential energy assistance program as part of the agreement. It’s also adding an optional tariff to help customers pay their wintertime bills and extending bill due dates from 15 to 21 days.
The company is expected to file a follow-up case early next year as part of the settlement agreement. It would add more energy efficiency programs to help offset utility costs.
“They would get new appliances or like programs for people to have new appliances or do an energy audit on their home and figure out where they could reduce costs,” Muncy said. “And that would also hopefully, be to the benefit of small business owners, not just residential customers.”
That’s alongside other proposed cost-cutting plans from Kentucky Power’s original filing, like bundling one-time costs from storm damage and selling them as a bond in a process called securitization. The process would mean lower utility costs over a longer period.
The Public Service Commission hearing started Tuesday and could continue through early December. If approved, the new utility rate will go into effect in January. Public comments can be submitted to the PSC during the hearing.
