MAGOFFIN COUNTY – If you opened your electric bill this month and thought it was all just a bad joke, you are not alone. And sadly, it doesn’t appear to be a joke or even something that is isolated to one company.
After receiving several reports of electricity bills that were exponentially higher than past bills, the Independent reached out to the company at the center at many of the complaints – Kentucky Power, as well as some of the governing bodies that oversee such complaints, and there were a few takeaways for the public.
First with the bad news that is no surprise for anyone who has bought groceries, filled up their car’s gas tank or basically bought anything they regularly buy: with the ongoing inflation, fuel costs are up. Costs of natural gas and coal, which fuels power plants, have steadily increased over the last several months, which in turn means an inevitable and unavoidable increase in electric bills, especially when paired with longer billing periods from the holidays and colder weather. This seems to be across the board, with Kentucky Power, Licking Valley RECC and Big Sandy RECC, with officials at AEP confirming this is a nationwide issue, not just Eastern Kentucky.
Kentucky Power also explained to the Independent that the “fuel adjustment” is a charge or credit for the actual cost of coal or natural gas used to generate or purchase electricity, so that recovers their cost for the fuel.
“Kentucky Power does not make a profit on fuel costs,” Cynthia Wiseman, with Kentucky Power, told the Independent. “The Company simply recovers dollar-for-dollar the costs of purchasing fuel to power its plants, which is passed through to customers. The charge or credit can vary significantly from month to month, depending on usage and the market pricing for fuel.”
Wiseman also noted that fuel costs were significantly lower last year, so customers often received a credit on their bills at times, but with fuel costs higher, the bills have also increased.
Utilities such as Kentucky Power have to set their rates based on the company’s actual costs and must be approved by the Public Service Commission.
“Rates are not set by the will and pleasure of Kentucky Power,” Wiseman said. “Any rate adjustment is a legal and regulated process that takes months.”
If a customer thinks the actual usage is inaccurate, which Wiseman explained is rare, they cam request a meter test and will not be charged for the test if the meter is malfunctioning.
All local electric companies urge their customers to let them know if they’re going to be able to pay the bill in full if they receive an abnormally high bill, offering payment extension of extended payment agreements to keep the customers in good standing and have no breaks in service at the coldest time of the year.
Additionally, there are payment assistance programs through the Community Action Program, with details of the regional service on page A6 of this week’s paper.
The Office of Rate Intervention through the Office of the Attorney General has received some complaints regarding Kentucky Power bills, but have identified the increased utility bills to fuel adjustment clause, which as Kentucky Power said, is regulated by the PSC and is based on the cost of fuel to generate electricity. If a power company’s cost increases to buy the fuel to provide your electricity, your bill will also go up. It’s legal and it doesn’t make the electric company any extra money.
Heather Clary, Director of Communications for the Better Business Bureau Serving Central & Eastern Kentucky, said the BBB hasn’t received any recent complaints regarding Kentucky Power, but they do accept them about billing issues if a consumer feels there has been an error.
Since the Kentucky Public Service Commission regulates utilities and approves the rates, the BBB can only try to help consumers if there is a billing error the business has not addressed, Clary said.
So, if you feel there is an error on your bill, step one is to contact your utility company. If you think there is still an error on your bill that they have not addressed, you can file a complaint with the Better Business Bureau. If you think this is a matter of “price gouging,” you can file a complaint with the Kentucky Office of the Attorney General. Chances are, however, it’s going to come down to the increased cost of fuel, which neither those offices, nor the power company, can actually change.
The only other option is to file a complaint with the Kentucky Public Service Commission, which regulates the rates, by going to https://psc.ky.gov/Home/Complaints. The Independent did reach out to the Kentucky PSC, but messages left with PSC media contacts were not returned by press time. As Wiseman from Kentucky Power stated, any changes to the rates are a lengthy process, so while long-term change could occur, filing complaints will more than likely not immediately affect the amount owed now.
And when there’s bad news, there must be some good news, right? Well, hopefully.
Wiseman told the Independent fuel costs appear to be on the decline, so the February bills should reflect a lower fuel adjustment.