Statesville City Utility residential electric customers started to experience something this weekend they haven’t in more than a decade: lower rates for electricity.
A 3 percent cut in electric rates went into effect Aug. 1, after 10 years of rate increases that totaled 43.7 percent.
City ratepayers had grown weary of nonstop increases in electric rates, which Statesville blamed primarily on higher wholesale electric rates it had to pay each year. In May, during the annual budget public hearing, a proposed tax increase was completely ignored by the attendees, who instead blasted the city’s electric rates, as well as its reconnection and late-payment fees.
“We hear what you are saying and I want you to know that all of us on this council are not turning a deaf ear to your concerns,” said Mayor Costi Kutteh at the time. He went on to explain that a debt refinancing by the N.C. Public Utilities Association, which supplies wholesale power to Statesville, might give the city a chance to reverse course on its rates. That refinancing did indeed occur on July 24, according to NCMPA spokeswoman Rebecca Agner.
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“We issued $480 million in bonds, and the issuance includes capital additions financing with a partial restructuring of existing debt and economic refunding,” Agner said. “The bonds were rated ‘A’ by Fitch and Standard & Poor’s rating agencies. With this transaction, wholesale rates are expected to remain stable for the next several years.”
About 80 percent of electric customers in Statesville are served by the city; the other 20 percent are served by Duke Power or Energy United. Statesville’s electric utilities director Kent Houpe told the council that if the refinancing had not occurred, the 80 percent served by the city might have faced yet another 5 percent rate increase instead. “This is an important and unique opportunity for us to reduce rates.”
Commercial and business rates are more complicated, Houpe explained. “There are about 20 different rates for those customers, but we are taking a look at those too.”
Besides Statesville, NCMPA comprises 18 other cities and towns in Piedmont and Western North Carolina, including some of the largest areas of economic growth. NCMPA also owns a portion of the Catawba Nuclear Station, operated by Duke Energy.
Meanwhile, in a separate action, the city has also reduced its reconnection fees from $50 to $25, which brings it into line with the reconnect fees charged by Duke Energy. Residents had complained that the higher fee was especially unfair to families facing economic difficulties.
Dave Vieser is a freelance writer: email@example.com.