In an effort to get ahead of what could be a contentious public hearing on electric rates, the City Council of Elizabeth City invited a representative of ElectriCities to explain the increasing cost of wholesale energy.
The hour long presentation on Friday by Ken Raber, senior vice president of ElectriCities, will be rebroadcast on Elizabeth City's channel 11 Monday night and throughout the week.
Elizabeth City's public hearing on a proposed 14 percent electric rate increase is scheduled for July 28.
The increase comes after the North Carolina Eastern Municipal Power Agency's Rate Committee met last month to review cost projections and then approved a recommendation to increase wholesale rates 14 percent.
The North Carolina Eastern Municipal Power Agency meets July 30 and is expected to approve the recommended wholesale cost increase.
Elizabeth City Manager Rich Olson warned the council in May that any rate increase from ElectriCities would have to be passed along in full to customers because of previous efforts to avoid rate increases.
In past years, the council was quick to request cuts while preparing the budget to avoid increasing rates. This year, however, there were few suggestions for the council to make.
Edenton and Hertford are also facing increased rates in September as a result of the higher wholesale cost.
On Monday, the Hertford Town Council rejected a proposal to increase retail rates 9.8 percent and commercial rates 11.7 percent, said John Christensen, town manager.
The council next month will reconsider his proposal and a suggested compromise that would increase the rate incrementally over the year - half immediately and half by January.
"We would have to absorb what we don't collect," Christensen said.
But absorbing that increase with the town's reserve fund is an undesirable proposition because rate increases can be planned for and emergencies cannot, he said.
The Hertford council meets again Aug. 11.
Anne-Marie Knighton, Edenton's manager, expects to request a 12 to 13 percent increase in retail rates. She said Friday that she's still researching the town's options but doesn't expect the proposal to drop below 12 percent.
Her recommendation will be considered during a committee meeting July 28, and the town council will make its decision next month.
In the meantime, customers in all three municipalities have been signing up for free home energy audits to find ways to conserve. ElectriCities completed more than 30 audits in Hertford and more than 50 customers have requested audits in Edenton. On Thursday, Edenton's Town Hall was audited, and a report is expected soon.
Overall, Raber said in his presentation to Elizabeth City, he's had to change the way he thinks about energy and its costs because the market is now global. Events in India or China are just as important to ElectriCities as are events throughout North Carolina.
"We're going to have to deal with this, not just now, but in the future," he said.
"This is the most difficult time I have ever seen in the utility business."
Dominion Virginia Power has increased rates about 18 percent, and in May, Albe-marle Electric Membership Corp. increased its rates so that an average bill for 1,000 kilowatt-hours increased by $7.26, to $117.23 per month. Chris Powell, a spokesman, said the electric cooperative re-evaluates rates constantly but thinks the existing rate will hold through the rest of 2008.
"We are in a very different time," Raber said Friday. "And it's not much consolation that we're not alone."
Lauren King, (252) 338-2413, lauren.king@pilotonline.com
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CUT ElectriCities
ElectriCities members (councils and mayors) should question the budget in detail so they can arrive at cuts to be made. The power agency can split off and be a more efficient entity for the cities but there is all this "extra" wrapped up in the existing structure. There is no reason to blindly accept something that harms your constituents without CLOSELY examining their budget. Look at the staff and salary increases. Do it now.
Cost Savings for ElectriCities
$168,000 Board of Directors Salary Cuts per year
Executive management – cap CEO at $250,000, save $200,000; cut $2 million from $6 million personnel budget; cap raises at 2.5%, no bonuses
Out of stateTravel, Sr Staff boondoggles, Annual Meeting (out of state), boondoggles and drinking events – save $200,000+
Cap legal fees at $150,000 (save $350,000+)
Eliminate contract lobbyists and cut staff lobbyists and save $500,000
SAVE $3,218,000 – apply it to the $12 million in costs due to the poorly thought out refinancing. This will help the bottom line
Then eliminate ElectriCities and split the Eastern Power Agency and Western Power Agency. Fund only the 20 eastern power agency staff in eastern NC. save hundreds of thousands more now and in the future.
The ElectriCities group
The ElectriCities group needs oversight. We need to demand legislators have hearings. The refinancing is bad. But overall the process is being abused.
See the Rocky Mount Telegram for an editorial about Tarboro and the Board Chairman Sam Noble.
ElectriCities NEEDS new MANAGEMENT And LEADERSHIP
Good for Hertford. They should not pass it until the Board at ElectriCities has passed it and the power agency has passed it. What is wrong with these towns? They just assume. There are solutions to be undertaken.
Raber said "This is the most difficult time I have ever seen in the utility business." Yes, it is because ElectriCities CEO knew he had a bad refinancing that was costing (now $12 million) and he sat on his hands and did not tell for 6 months. Then he told his Board who sat and did not tell us, the people who pay, for 4 months.
"We are in a very different time," Raber said Friday. "And it's not much consolation that we're not alone." WE ARE ALONE. We alone are a public entity with an overpriced CEO, too many executives, too much spending.
Fortunately the Rocky Mount Telegram has written some editorials, articles and op-eds about making cuts.
Some ideas:
$168,000 Board Salary Cuts
Executive m
EASTERN NC IS IN REBELLION
If you live in one of the 19 western cities, especially those in Gastonia, Lexington, High Point, Granite Falls, Monroe (Board Member cities) and you want to help with a letter to the editor and comments to the council, email Alman on www.bluenc.com Same for 32 eastern cities especially Tarboro, Wilson, Rocky Mount, Greenville, La Grange and Wake Forest (board members). Different letter and comments.
We will be spreading out and covering reporters in cities, councils/Mayors, business leaders. We will get a spokesperson for each group.
Talk to your paper, call city council, email and call legislators. Time to let the voice of the
ElectriCities
Eastern NC SPEAKS OUT and is in absolute rebellion over this situation. There is MISMANAGEMENT, OVERSPENDING, NO ACCOUNTABILITY. And the worst atrocity is that cities are approving it BEFORE the ElectriCities Board meets on July 25 and the power agency on July 30 which MEANS this was a done deal and these hearings make no difference. Jesse Tilton CEO knew since Oct 2007 but he did not tell until March and his board did not tell until June.