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'Meter Fee' on 1.3 Million Utility Customers Could Roughly Double

A pair of Kentucky power companies want to roughly double the Basic Service Charge their 1.3 million customers pay.(Greg Stotelmyer)
A pair of Kentucky power companies want to roughly double the Basic Service Charge their 1.3 million customers pay.(Greg Stotelmyer)
December 21, 2016

FRANKFORT, Ky. – Sister utilities KU and LG&E want to roughly double the basic service charge on customers, a charge commonly known as the meter fee. The request to restructure the rates would impact 1.3 million customers in 93 counties.

Sarah Lynn Cunningham, the Climate Change Subcommittee Chair with the Sierra Club in Kentucky, said raising the basic service charge would reduce a customer control over the size of their bills.

"We have the opportunity to reduce our consumption, but when you put it on the meter fee it doesn't matter if you're wasteful or not," she said. "It doesn't matter if you live in a little bitty house or a great big huge McMansion, you're going to pay the same fee and that's very, very unfair."

But Natasha Collins with KU and LG&E said the proposal is "a step toward providing customers with less bill volatility from cold winters and hot summers when customers can least afford it." The utilities propose a slight reduction in the consumption charge to counter-balance a higher meter fee.

For KU electric customers the basic service charge would increase from $10.75a month to $22. LG&E proposes increasing the fee on its combined electric and natural gas customers to $46 from the current $24.25 a month.

LG&E customer Ebonee Sutton said doubling the meter fee is "like a predatory business practice." She said it makes more sense to tie rates to usage.

"That way we can say, 'Well, let's just bundle up during winter time,'" she said. "'Let's sleep in layers or keep the thermostat a little lower when we're not here.'"

Requests to intervene in the case have run the gamut from industry and businesses, including Wal-Mart and Kroger, to governments, including Lexington, Louisville and the Department of Defense. In its request to the Public Service Commission, DOD said the rate change would have a "significant impact" on Fort Knox. The Sierra Club's Cunningham fears the proposal would reduce customer incentive to save energy.

"I think they're doing this because every time somebody puts in a more energy-efficient refrigerator or furnace, or somebody puts on solar panels, they're losing business," she explained.

Collins said since 2008 the sister companies have spent $262 million on energy efficiency programs and with customer participation it has helped delay the need for building additional generation. The PSC has not yet set a hearing date on the rate case.

Greg Stotelmyer , Public News Service - KY