Blue Ridge, Duke Energy customers to see cost increase

Staff Writer

reseaborn@pickenssentinel.com

PICKENS COUNTY - Customers of Blue Ridge Electric Cooperative and Duke Energy will see an increase in their bills early next year as the two main providers of electricity in this area raise their rates.

Terry Ballenger, Blue Ridge Electric communications manager, said the cost to manufacture electricity is driving up the cost they charge their customers by up to 20 percent.

"We are not totally sure right now how much the increase will be, but we are looking at between 10 and 20 percent," Ballenger said. "We will have a clearer picture sometime in November or December."

The rate hike should be established sometime within the first three months of 2009, and Blue Ridge customers could possibly see the increase as early as in their January bills, he said.

The main suppliers of energy to Blue Ridge Electric primarily use coal in the generation of electricity, and have experienced significant cost increases, which are being passed along to the customers, he said.

"The cost of coal has doubled in the last 12 months," Ballenger said. "Our costs are driven by the cost to generate the power we purchase.

Large quantities of coal are being shipped to other countries, such as China and India, which depend on American coal, he said.

"Coal companies are struggling to keep up with demand," Ballenger said. "Supply and demand is driving the cost up."

The skyrocketing cost of natural gas is also playing a role in the hike in electricity prices, he said.

"We use only a small amount of energy generated by natural gas, but it still affects the cost," Ballenger said.

Duke Energy is also feeling the effects of a cost increase in coal after seeing the fossil fuel rise in cost, going from $40 per ton to about $100 per ton, said Jason Walls, a spokesperson for Duke Energy's Oconee Nuclear Station.

"The main reason is that coal prices have risen, doubling, since the summer of 2007," he said. "When fuel rates go up, the cost is passed along to our customers."

About 50 percent of the electricity produced in South Carolina is generated from nuclear energy, a portion of the power produced is from coal, he said.

In addition to the increasing costs of coal, extreme weather and the recent drought has also played a role in Duke Energy's plans to seek a hike in consumer costs for electricity, he said.

"During the 2007 summer, we used more power than ever," Walls said, adding the additional usage resulted in the company having to purchase power from other energy suppliers.

Duke Energy is seeking approval from the Public Service Commission of South Carolina to increase their rates by six percent for residential customers and seven percent for small businesses, he said. Industrial users could see a rate hike of 11 percent with the approval of the regulators, he said.

Easley Combined Utilities customers realized a rate hike of two percent levied in April, said Linda Abercrombie, with ECU's billing department.

Since customer billing runs from April through March, Combined Utilities normally plans rate hikes to coincide with that cycle, she said.

"There's been no announcement yet for an increase next year," she said. "We usually look at that in March."

Ballenger said that energy customers can conserve power through simple efforts, including replacing their regular incandescent light bulbs with the energy-efficient compact fluorescent bulbs.

CFL bulbs use about 75 percent less power than standard incandescent bulbs and can save about $30 in energy costs over the bulb's lifetime, which is about 10 times longer than standard bulbs, he said.

Also, when purchasing appliances, consumers should ask if the item is energy efficient, he said.

All electric heating and cooling units use large amounts of electricity to operate and should be avoided, he said.

Ballenger said utility costs increases should not affect the money the company contributes back into the community.

"We raise the money we put toward charitable contributions through the Blue Ridge Fest," he said. "While the increase in energy costs won't affect what we put back into the community, the economy might. But we hope that doesn't happen."