EAGLE ROCK – Craig-Botetourt Electric Cooperative recently submitted a request to the State Corporation Commission for a more than 6 percent rate increase in order to offset millions of dollars spent in upgrades to aging infrastructure.
If approved, the rate increase could generate nearly $730,000 in additional revenue for the New Castle-based cooperative. Under the proposal submitted in late 2020, C-BEC’s residential-rate customers could see a 6.34 percent increase, while seasonal rate consumers’ bills may jump by 1.22 percent, according to the company and the SCC filing.
The 73-page filing states a typical residential customer using 1,000 kilowatt hours of electricity each month would experience a monthly bill increase of $9.69, from $153.81 to $163.50. C-BEC stated the additional revenue would pay for expenses, service debt, fund capital additions, and meet the financial goals established by its board.
C-BEC’s Chief Executive Officer Jeff Ahearn said the company hasn’t raised general rates in more than a decade, but the cooperative came out of 2019 needing to increase revenues. After speaking with consultants, C-BEC decided raising rates was its best option. “Let’s say 2019 was a tough year,” said Ahearn. “We were approaching a critical” financial situation.
Ahearn explained the utility’s infrastructure is many decades old, some dating before World War II. To modernize its equipment, the cooperative invested $10 million in a new substation in Montgomery County in recent years. In the Q2 2021, the substation is slated to be online to pick up slack from New Castle and Botetourt, ensuring more reliable service.
Additionally, the last two construction work plans C-BEC slates $10 million worth of improvements.
C-BEC’s 7,200 members in Alleghany, Botetourt, Craig, Giles Montgomery and Roanoke counties could see the increase in their May 2021 bill. According to Dun and Bradstreet, C-BEC had $13.27 million in sales in 2019. The cooperative requested the increase start April 15. The SCC hasn’t set a ruling date yet.
Opposition to the increase is strong. During a public comment period on the raise, nearly 20 C-BEC’s customers contacted the State Corporation Commission, all against the rate hike.
“For the love of all that is holy, please do not raise the rates any further than they already have been! PLEASE,” David Webster of New Castle wrote.
William Songer, of Newport, wrote the rates are already high, higher than any other electric provider in the area. “These are VERY tough times these days and we don’t need this right now,” he wrote.
Another New Castle resident, David Lindsey, wrote that a rate hike could create a financial hardship for people given the COVID-19 pandemic. Additionally, C-BEC is operating at a profit. “Yes, it is nice to make more money and be able to retire debt. But this would be done on the backs of people trying to make ends meet. People that are retired with the only income being from social security [and they] are only getting about a 1.5 percent increase in SSI benefits … It’s just not the right time for a rate increase in electric cost.”
Only one comment came from Botetourt County, Eagle Rock’s Robin Fridley. In an interview, Fridley said she and her family moved to Eagle Rock in 1992 when electricity was 50 cents a KW hour. Nearly three decades later, her rate has almost doubled.
“I realize [C-BEC] needs to make a profit. Our service hasn’t increased, but our bill is twice as much as it was 20 years ago,” she said.
The family does have electric heat, but offsets it by keeping the temperature at 68 degrees and using gas logs. “I realize they have to raise rates, but why does it have to be 6 percent? Why such a high amount?” she asked.
Fridley and other customers question the accuracy of C-BEC’s filing, especially statements about monthly bills increasing from $153 to $163 a month.
In the summer, the Fridleys’ bill runs between $120 to $125 each month for their 1,300-square-foot home on Mount Moriah Road. However, in the winter their monthly bill skyrockets to about $230. Last week, Fridley said she’s budgeting $300 for January’s electric bill.
Janet Overstreet of New Castle wishes her bill was lower. She said she pays $200 in the summer and double the amount in winter. “So [C-BEC] raises these rates even more, I’m pressed between paying this bill or buying food,” she wrote.
Newport resident Chelsea Grippo spent an entire $600 paycheck last winter to pay her monthly electric bill, she said.
Ahearn said he understands the concerns of customers. “We’re doing everything we can to control cost,” he said.