Kentucky Power customers predict trouble if rate increase goes through

PIKEVILLE — Kentucky Power's goal is to do routine line maintenance every four or five years, but it hasn't met that goal, company officials said after a public hearing to gather feedback about a 24 percent rate increase that would raise customers' bills by nearly 35 percent.

"Right now we don't have the money to get to that four- to five-year frequency," said Ranie Wohnhas, director of business operations support for Kentucky Power.

Kentucky Public Service Commission members heard from about 25 people at a gathering of about 100 at Pikeville High School on Tuesday night.

Grocery store owners warned of increased food prices, officials from Mountain Water District said its power bills would increase by $17,000 a month and a college student predicted an increased burden on those working two or three jobs to pay tuition.

The company's last rate increase took effect in 2006. If the new request is approved by the PSC, which considers whether the increase is "fair, just and reasonable," changes would take effect in July. Another public hearing on the request will be at 5 p.m. Wednesday at Hazard Community and Technical College

Kentucky Power is a subsidiary of American Electric Power, a publicly traded company with power customers in 11 states. Kentucky Power's revenue last year was $632 million, down about 5 percent from the previous year. The company hopes the rate increase, based on costs from the fiscal year that ended in September 2009, will boost revenue by $124 million.

Customers and elected officials at the hearing Tuesday spoke out against so large a rate increase during tough economic times, in an area of the state with high poverty rates.

"Consider the poor," said Nancy Taylor, a former teacher and banker who cares for her mother in Meta.

Social Security recipients haven't seen a cost-of-living raise in two years, said Carol Napier, who oversees Pike County senior citizens centers and serves on the Big Sandy Area Development District council on aging.

Napier said she has seen people "literally have to juggle their financial affairs to meet their basic needs."

Napier said she thought cost-cutting to keep the company profitable for stockholders contributed to outages in Eastern Kentucky. Kentucky Power experienced its largest single outage during a December snowstorm, and customers expressed frustration with a lack of line maintenance.

"I just wish you'd get somebody to look at these lines and the shape that they're in," said Pike County resident Robert Charles.

Another Pike County resident said her church had received record requests for help with power bills in recent months.

Said Martha Ridenour, "This is an outrage that they would ask for this kind of increase now ... They are making very good money."

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