Louisville Metro Government plans to formally intervene in a request before the Public Service Commission from Louisville Gas and Electric to raise utility rates.
LG&E’s proposal would raise the basic service charge for both electric and gas on ratepayers’ bills, and slightly decrease the cost of the actual electric and gas usage. The company estimates it will raise the average bill by $12.64.
But the way the company is raising the rates — by increasing the fixed cost charged to every customer rather than charging more based on usage — has drawn critics concerned about how it would affect low-income residents. Ratepayers currently pay $24.25 in service fees every month; if the Public Service Commission grants the rate increase, that amount will rise to $46 a month.
“So before you’ve even used any utilities, you’d be paying $46,” said Cathy Hinko, Executive Director of the Metropolitan Housing Coalition. “If your income is $500 a month, $46 has a whole different meaning to you than if your income is $3,000 a month.”
LG&E spokeswoman Chris Whelan said the change is necessary for LG&E to increase reliability. Part of the rate filing involves installing advanced meters on every home and business. These will allow the utility company to instantly see when and where there’s a power outage, and can fix it quicker. Also, customers can look up their energy usage online and track it to the minute.
“We don’t go in and just ask for an increase in rates just to be doing it,” Whelan said. “We really think these initiatives that we’re doing and the investments we’re making in our system really will help improve safety and reliability and service to our customers.”
In a news release, Louisville Mayor Greg Fischer said the city government spends about $17 million every year on electricity and gas, which gives it an interest in any potential rate increase. Fischer also said he was concerned about the effect on the city’s residents.
“It’s important for Metro Government to be part of the discussion on a decision that will impact every household in our city,” Fischer said. “This will allow us the ability to advocate for the citizens of Louisville while better understanding the needs of LG&E.”
Filing to intervene doesn’t necessarily mean that Metro Government opposes the rate increase, but gives the city a seat at the table. In intervening, Metro Government will join other entities with an interest in the cost of utilities, like Kroger, Attorney General Andy Beshear, the Kentucky Industrial Utility Customers and the Association of Community Ministries.