BREMCO to increase rates

Published: 5:20 PM, 08/22/2012

Last updated: 5:51 PM, 08/22/2012

Blue Ridge Electric rates will increase 2.5 percent in October due to rising wholesale power costs, the cooperative announced Tuesday.

An average customer using 930 kilowatt-hours per month will see their bills increase by about $2.70 per month, Blue Ridge Electric said.

Blue Ridge Electric, which serves 74,000 customers in Caldwell, Watauga, Ashe and Alleghany counties and parts of Avery, Alexander and Wilkes counties, purchases wholesale power from Charlotte-based Duke Energy. 

It in turn sells power to New River Light & Power, which serves Appalachian State University and a portion of Boone.

Renee Whitener, director of public relations at Blue Ridge Electric, said Duke Energy is projecting an 8 percent increase in its wholesale power rates.

“The wholesale power makes up such a large percent of the budget … 60 percent of our budget,” said Whitener. “We’ve been able to mitigate that and hold it to 2.5 percent. We’re excited because we don’t have to pass along an 8 percent increase.”

Whitener said Blue Ridge Electric has been able to reduce operating costs by $2.9 million through an employee-led WorkSmart initiative, including the elimination of some vacant positions, reduced use of supplies and restructured benefits packages.

Speaking in April, Whitener said the cooperative is working to keep rate adjustments in a projected range of 2 percent to 3 percent annually for the next few years. Blue Ridge Electric’s last rate increase was in March 2010, a hike of 3.4 percent.

Blue Ridge Electric leaders say increased environmental regulations are responsible for rising wholesale power costs.

“The driver of this is not Blue Ridge Electric’s operation costs,” Whitener said. “That is entirely coming from environmental laws and regulations. The key to it is replacing old coal plants that produce cheap electricity.”

Blue Ridge Electric CEO Doug Johnson said in a statement that electricity prices have been relative stable since the 1990s, but are now on the rise.

“As a nation, we’re now entering a period where significant, costly factors are coming together: closing coal plants that can’t meet environmental laws and replacing them with new power generation plants, and investing in transmission delivery systems to ensure reliable electricity and compliance with new environmental and security regulations,” Johnson said.

“We’re seeing billions of dollars spent to comply with state and federal environmental laws, such as the North Carolina Smokestacks Act and Renewable Energy and Energy Efficiency Portfolio Standard, as well as the Clean Air and Clean Water acts, to protect our environment.”