Nola Sizemore

Harlan Daily Enterprise

Considering whether Kentucky Utilities’ proposed new rates are “fair, just and reasonable,” the Kentucky Public Service Commission (PSC) will hold a public meeting at 5:30 p.m. on Nov. 8 at the Harlan campus of Southeast Kentucky Community and Technical College.

Hoping to educate everyone about the PSC’s rate-making process and to receive comments from the public about proposed rate increases by the Kentucky Utilities (KU) Company and the Louisville Gas and Electric Company (LG&E), the meeting will begin with a presentation and then comments from the public will be heard.

“We’ll walk people through our rate-making process works,” said PSC Director of Communications Andrew Melnykovych. “We’ll look at what the PSC has to consider when it’s looking at rates. How rates are structured — what is included and not included in rates. How you make a determination as to what is fair, just and reasonable for the rate payers and for the utility itself, and how you allocate the rates in the various customer classes. This should take about 20 to 25 minutes. Then, people will have the opportunity to make comments directly to the commission. Also, there will be a form available for those who wish to make written comments.”

In considering comments from the public, Melnykovych said this was “one of many factors” in the PSC’s decision to increase rates.

“There are a number of things the commission has to consider,” said Melnykovych. “Nobody ever wants their rates to go up. If the commission went strictly by public comments then every time we’d have a proposed rate increase and people said they didn’t want a rate increase then the utilities would go bankrupt. Obviously, at some point you have to have a rate increase.”

The last rate increase for KU customers was in 2010. The new proposed rate increase for 2013 will affect all classes of customers in order to generate an additional $82.4 million in revenue per year, which is an increase of approximately 6.5 percent. Kentucky Utilities estimates that the average monthly bill for residential customers will rise approximately $7.41 for a bill of $99.71, an increase of about 8 percent from the current monthly average bill of $92.30.

Melnykovych said most of the proposed increase will come through raising the monthly service charge to $13 from the current $8.50. He said the charge per kilowatt-hour will rise from 6.987 cents to 7.235 cents. A kilowatt house is the amount of electricity used by a 100-watt light bulb in 10 hours.

With approximately 546,000 customers in 77 counties across Kentucky, Melnykovych said KU’s base rate increases are needed to pay for upgrades to electric transmission and distribution systems, improvements at electric generating facilities and the hiring of additional employees, particularly in its customer service operation. He said the company also cited increased costs to comply with tighter federal cyber security standards.

Written comments may also be mailed to the PSC at P.O. Box 615, Frankfort, Ky. 40602.