Glasgow City Councilperson Marlin Witcher appears at a finance committee meeting of the Glasgow City Council in August 2020. Witcher was one of three board members on the Glasgow Electric Plant Board to support a rate restructure, which eliminates coincident demand and time of use charges.
(BRENNAN CRAIN/WCLU NEWS)
GLASGOW, Ky. — Residential and small commercial customers of the Glasgow Electric Plant Board may no longer see time of use and coincident charges on their bill.
The Glasgow Electric Plant Board moved Tuesday evening to send a proposed rate structure to the Tennessee Valley Authority for final approval. The proposed structure shifts away from non-volumetric structure that includes “peak demand.”
“Melanie and Josh have confronted TVA in the process of trying to get the kind of rates that we want,” said GEPB chairperson, DT Froedge. “We have come to an agreement to what we want and what they will allow. And I think it’s pretty well defined.”
All of the rate structures’ terms are subject to final approval of TVA. Officials with the GEPB expect to enact the new rate structure within two months, if approved.
Residential customers will see a decrease in their customer charge. The charge is a fee that customers pay to connect to the area power grid. The cost provides for overhead costs of the electric utility.
The variable rate customer charge, which includes coincident demand and time of use charges, will decrease from $31.97 to $25.54. Customers on the flat rate will also see a slight decrease to that charge, which deviates from their current $28.54 charge.
All coincident demand and time of use charges will be eliminated. A seasonal flat rate worth $.10343 per kWh will be applied to bills.
The variable rate included a $.05434 per kWh cost, according to data posted to the GEPB’s website in 2019. The pending rate uses a volumetric model, which factors all customers’ consumption into the unit charge.
Small commercial customers will see a decreased customer charge too. The current rate will drop from $56.61 and $50.59 for variable and flat rate customers, respectively, to $42.00.
All demand charges will also be eliminated for those customers.
The Glasgow EPB will continue to keep its medium and large commercial customers on the non-volumetric structure. Those customers are considered “revenue neutral” on TVA’s model.
The utility receives a 3.1% rebate each month since it signed a 20-year agreement with TVA. A portion of that rebate will continue to support community programs, but the remaining is passed down to customers, which in turn lowers bills to a residual degree.
“With that, we have to keep those medium and large commercials on the rate that they’re on now,” said interim superintendent, Melanie Reed. “Once we take them off of that rate, those credits would have to be passed through to them. I think for now, this is a pretty good compromise.”
Froedge, a longtime advocate for a rate restructure, said he hopes to see the customer charge decline in the future.
“From our discussions, it seems that they are willing to drop this tap on fee over a period of time to a lower number, which I’d like to see about $15,” Froedge said. “But right now, $25 is an improvement, and it’ll be a while. But they like gradualism, and so we will do it slowly.”
The board unanimously approved the rate structure. Libby Short was not present.
The structure must be presented to TVA before it is enacted in Glasgow. Customers will be alerted of their bill modifications before the change occurs.
In other news, the superintendent’s job position will be advertised beginning in May. GEPB staff has finalized the advertisement with information about Glasgow and the job’s description.
The GEPB continued to meet virtually Tuesday. Future meetings may return to the boardroom, but some members will continue to appear via Zoom.
The GEPB has remained at four members since Tag Taylor’s term ended in early 2021. Harold Armstrong, Glasgow mayor, plans to give the Glasgow City Council an appointment at their next meeting, he said. It’s unclear who that person will be.