Lawmakers voice opposition to rate increase
by Cris Ritchie Editor
Legislators in the Kentucky House of Representatives are encouraging the Public Service Commission not to grant a rate increase request made by Kentucky Power Company last year.
Kentucky Power Company (KPC), a subsidiary of American Electric Power, submitted a proposal to increase utility rates to all of its 175,000 customers in Kentucky. According to a press release, KPC is looking to increase rates by nearly 35 percent, and submitted the request to the Public Service Commission (PSC) in December following a widespread power outage resulting from the December 19 snowstorm.
Several local leaders in the region have already expressed their disapproval of KPCs request, including Hazard Mayor Bill Gorman, and now several state legislators are doing the same.
In a memo sent to the Public Service Commission dated February 19, state lawmakers suggested that the current economic climate dictates that PSC should reject this request for a rate increase.
With Kentucky Power Companys current Long Term Debt to Equity ratio of 71.9 percent, the request for a near 35 percent increase in residential rates is not justified and should not be granted by the Public Service Commission, the memo reads. Particularly at a time of our nations deepest recession in decades, the burden of Kentuckians of a near 35 percent increase in residential electric rates is too great.
Rep. Fitz Steele, one of the 14 lawmakers to sign the memo, said too many people in his district, which includes Perry County and a portion of Harlan County, are already having to make hard choices when it comes to their own budgets, and higher utility rates would only exacerbate their financial difficulties.
In this day and time, and the way the economy is, our people are barley scraping by right now, and theyre (KPC) wanting to raise our electric rates, said Steele. We dont need to be hit with that right now.
There has been a lot of reaction to KPCs request for a rate increase, much of it negative. According to Andrew Melnykovych, communication director for PSC, the commission is currently planning to hold hearings in the near future to hear comments from the public. Melnykovych noted that the hearings are currently planned for April, but no definite dates have been set.
Public hearings for rate requests are fairly common, Melnykovych added, but noted that the PSC is more apt to hold such hearings in light of a significant amount of public interest.
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