Kentucky Power to ask for rate hike that would start next year
Eastern Kentucky’s largest power provider told lawmakers Thursday they plan to raise rates next year even as officials acknowledged their customers already face some of the highest electricity bills in the state.
Kentucky Power’s facing the economic headwinds of inflation, regional population decline and a loss in major industrial customers.
The company’s lost more than 11,000 ratepayers in the last 15 years including large industrial customers like AK Steel, coal mines and hospitals.
Now the company’s fixed costs are spread among a smaller pool of customers, said Kentucky Power President Cindy Wiseman.
Wiseman spoke to lawmakers at an interim joint legislative committee hearing on natural resources and energy on Thursday. She said the company plans to file a rate case with utility regulators later this summer for an increase starting next year.
“In order to keep the lights on, we have to make investments in infrastructure and add generation to our fleet,” Wiseman said.
Kentucky Power plans to retire at least one coal-fired power plant by 2028, and replace it with a mix of natural gas and renewable energy.
Eastern Kentuckians already pay the highest electricity bills in the state, according to a state dashboard.
Among the other issues, Wiseman said Kentucky Power customers’ have homes that are older and less energy efficient resulting in more electricity usage than the national average.
Kentucky Power may expand programs to assist low-income ratepayers with rising electricity bills and improve energy efficiency in people’s homes, she said.
“We can’t change the economy by ourselves in eastern Kentucky. We will do what we can to mitigate rates for customers,” Wiseman said.
Earlier this year, Kentucky Power’s parent company, American Electric Power, terminated negotiations with Liberty Utilities for the sale of the eastern Kentucky electricity provider.
Wiseman said there was no single reason to end the deal except for an extended federal review at the Federal Energy Regulatory Commission.
FERC regulators nixed a first version of the deal after the companies failed to provide complete information to evaluate the effect on customer rates, and proposed insufficient protections for ratepayers.