Get ready to dig deep for power bills

November 24, 2008 9:00:00 PM PST
If you live in Wake County - or anywhere else served by Progress Energy - your electricity rates are going up this weekend. Some customers are paying more of an increase than others, and that has some claiming discrimination.Starting December 1, the typical household's rate will jump just over 10 percent. The increase, which also affects businesses, is supposed to allow the utility make up for higher fuel costs. While gas prices have been dropping, Progress uses coal to generate half its power and those prices aren't going down.

"From June of 2007 to June of 2008, coal prices increased 160 percent," explained Jeff Brooks with Progress Energy.

But with this increase, for the first time customers will not all pay the same rate.

"They're raising it discriminatorily so that residents pay more than big industrial and big customers," charged Shana Becker with the consumer advocate group NCPIRG.

Residential customers will pay 57 percent more than big industrial firms for the extra fuel-charge and cities and towns which pay for street lighting will pay more than three times as much on the fuel charge.

NCPIRG says that means taxpayers are being saddled with the rate increase disparity. The Attorney General's office argued the differences were discriminatory, but the Utilities Commission agreed with Progress.

It means fuel charges would be pegged for the first time at 9 percent of existing rates. But those rates are not same. While homeowners pay about 9-and-a-half cents per kilowatt hour, commercial customers pay only 7 cents and industrial users about 5-and-a-half cents.

Progress says big industrial users were bearing an unfair fuel burden under the old fuel charges, which were levied equally in terms of dollars and cents. Progress says the old math was bad for business.

"What we're hoping to do with this reallocation is to adjust the fuel cost fairly within all of our customer classes. We've seen our industrial class decline in our service territory," said Brooks.

Others say big business is already getting a better deal on electricity than homeowners and they don't deserve the same deal on fuel used to make it.

"That's a huge subsidy out of working families for big industrial," said Becker.


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