Kentucky Utilities Asking for Increase in Electricity Rates to Finish Natural Gas Unit

Nov 5, 2014

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Kentucky Utilities plans to ask the Public Service Commission to raise its base rate for electricity to cover the construction of a natural gas unit.

The utility’s Director of Media Relations Natasha Collins says they have filed a notice with the PSC to raise rates from nearly nine cents per kilowatt hour to 10.5 cents. The recent increase in Paducah Power System’s base rate is set at more than 11 cents and rises to nearly 13 and a half cents with Power Cost Adjustment according to its website.

Collins says the Kentucky Utilities increase will cost residential customers approximately $11 a month and help finish the natural gas combined-cycle generating unit that is set to begin operations May 2015.

“We are currently constructing Kentucky’s first natural gas combined-cycle generating unit that will allow us to help meet stricter environmental mandates that have been set forth by the EPA,” Collins said. “That unit is a $563 million unit and will ultimately allow us to produce 640 megawatts to replace some of the generation that will be lost as we retire 13 percent of our older coal fired units and it will also help us to produce energy with less emissions.”

PSC Spokesman Andrew Melnykovych says this is the beginning of a long process. Once the utility files its application for the increase the PSC has 10 months to make its decision.

Kentucky Utilities provides electricity to more than a dozen counties in western Kentucky.