Kentucky utilities reach rate review agreement
Louisville Gas and Electric Company (LG&E), Kentucky Utilities Company (KU) and most parties to the utilities’ rate review recently reached an agreement, which was filed with the Kentucky Public Service Commission (KPSC).
The agreement, which is subject to approval by the KPSC, allows LG&E and KU to invest in intelligent control equipment to enhance reliability and replace aging steel natural gas lines with new plastic lines.
The utilities also committed $1.45 million of shareholder dollars annually for the next four years to low-income advocacy groups to support the utilities’ low-income customers.
The utilities also agreed to withdraw their plans for full deployment of advanced meters (AMS), but will continue their voluntary advanced meter program.
“There were a large number of parties with different interests involved in this case and we are pleased to have reached a settlement that benefits our customers and their constituent groups,” Kent Blake, LG&E and KU chief financial officer, said. “The agreement gives us the ability to enhance our reliability and continue providing safe and reliable service to our customers while meeting the needs of the parties to this case.”
If the filing is approved, KU will receive a revenue increase of $54.9 million, while LG&E would see an electric revenue increase of $59.4 million and a natural gas revenue increase of $7.5 million.
The bill for a KU residential customer that uses an average of 1,179 kilowatt hours per month would increase by $4.21 per month. An LG&E residential electric customer using an average of 957 kWh per month would see an increase of $6.77 per month. For residential LG&E natural gas customers that use an average of 55 Ccf per month, bills would increase by $1.47 a month.
According to the agreement, the monthly electric basic service charge for LG&E and KU, included in the increase above, would be $11.50 beginning July 1, and $12.25 beginning July 1, 2018, respectively. LG&E’s monthly natural gas basic service charge would be $16.35 beginning July 1, 2017, and remain the same until a future rate review.
The public hearing on the rate review is scheduled to begin May 9 at the KPSC offices in Frankfort, Kentucky.
