High bills: consumption up; not rates


Thursday, March 10, 2011
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High bills: consumption up; not rates

By SUE WATSON
Staff Writer

With an extra cold winter, some customers of the Northcentral Electric Power Association have complained about high electricity bills in recent months.

Kevin Doddridge, general manager of the utility, said the basic electricity rates have not been raised.

Customers in the Cayce Road, Lake Hill Cove, and West Cox Road area have been comparing their bills and say they have bills in the $400 a month range.

Doddridge said billing runs several weeks to nearly a month behind meter reading and people may be expecting their bill to be down due to recent warmups. But the February bill may reflect power used in January, he said.

The wholesale price of power, what Northcentral pays the Tennessee Valley Authority for power, has fluctuated quite a bit over the last two years, he said.

“It’s been all over the place,” he said. “The reason people’s bills are up is due to consumption and due to cold weather. This is the coldest winter we’ve had in about three years. We absolutely did not raise rates due to the new building.”

Doddridge said Northcentral has not changed its retail rates in years, so the increased costs of power are due to increases in the fuel cost adjustment (FCA) TVA charges.

Residential customers were charged 8.5 cents per kilowatt hour in January and a half a penny (.584 cents) per KWH in FCA, he said. The same base rate of 8.5 cents per KWH and a .653 cents per KWH will be charged in March.

“It’s fuel,” he said. “It’s when you have an extremely cold day. This spring TVA may have to maintain some of its generation facilities to prepare them for the hot summer. If we have an abnormally hot or cold day while these generators are off line, TVA may have to buy power off the open market to handle the electricity demands in our area. Power bought on the market is typically higher and could result in higher fuel costs as well.”

Customers can compare their usage to the previous month and to the same month last year to see if they used more power in a given month, Doddridge said. Comparisons can be used as a type of standard to determine if the customer has used more energy or if the cost of power has gone up.

A customer who wishes to look at their power use over a longer period of time is welcomed to come into the office and look at their usage, he said.

Conserving energy is more important, he said. Tips on how to conserve energy are available on the Internet at www.energyright.com.

He said the move into a new building near Olive Branch will affect the Byhalia community economically.

“We realize that the move is going to be a change for everyone,” he said. “When you are in the utility business, you have to think 20 to 30 years out. We got good construction rates since we built during the down economy. We will continue to work with our community to try to keep rates low. That’s what we want to do.”

Don Hollingsworth, general manager of the Holly Springs Utility Department, agreed that the rates cited by Doddridge are accurate.

A residential customer, when all is said and done, pays nearly 10 cents per KWH, he said.

“That’s the rule of thumb - the minimum bill and everything,” he said. “That’s the layman’s way of doing it.”

But a more scientific way to monitor energy consumption over time is to look at the degree days, he said, the days where the average temperature was 65 degrees and required no heat or cooling.

“Take the low and the high of the day,” he said. “If the average is lower than 65 degrees it is a heating day. If it is above 65 degrees, it is a cooling day. Presidents’ Day this year was in the 70s. We had snow and freezing weather on Presidents’ Day last year. That’s the only scientific way to keep up with it.”

There is a type of monthly adjustment in the price of all energy commodities, he said, including natural gas, because of fluctuations in the market.

“Natural gas has been doing it longer,” he said. “Now we have a set price for our operational costs plus a margin (profit) and then add the monthly cost of commodity adjustment (FCA, in the case of electricity).”

On April 1, TVA is changing its rate structure to go to a time of use rate which will fluctuate during the day for some customers eventually. The information on time of use rate structure will be presented in future articles in The South Reporter.

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