Speak Out! Stop LG&E and KU from raising – and rigging – rates

All Kentuckians need and deserve affordable and clean energy. But Louisville Gas & Electric (LG&E) and Kentucky Utilities (KU) are trying to raise – and rig – their rates in ways that are harmful to low-income residents and discourage Kentuckians from making the most of energy efficiency and rooftop solar. And the Kentucky Public Service Commission (KY PSC) is acting as the utilities’ own bodyguard, rather than as a fair referee.

As customers of LG&E and KU, now is the time to make our voices heard at the KY PSC.

• Email written comments to the Kentucky PSC by March 5 at: [email protected]. Be sure to put these case numbers in your subject line: 2018-00294 (KU) and 2018-00295 (LG&E). We’ve provided suggested talking points below. You can also use this page to personalize and send your comments directly to the KY PSC. Tell your own story if possible. 

• Attend and speak out at a public hearing:
  
  Louisville: Thursday, February 21 - 5:30 p.m. EST - Health Sciences Auditorium, Health Sciences Hall, Jefferson Community and Technical College, 110 W. Chestnut St.
  
  Lexington: Tuesday, February 26 - 5:30 p.m. EST - Classroom Building, Rooms 105-106-107, Bluegrass Community & Technical College, Newtown Campus, 500 Newtown Pike
  
  Frankfort: Tuesday, March 5 - 9 a.m. EST - Public Service Commission, 211 Sower Boulevard, Hearing Room 1 (public comments are usually taken early in the day, before the formal hearing begins. So best to be there by 9 a.m.)

Act now. Tell the KY Public Service Commission:

All Kentuckians need and deserve affordable and clean energy. This rate case (Case number 2018-00294 (KU) and 2018-00295 (LG&E)) moves us in the wrong direction. The LG&E and KU plan is bad for consumers, harmful to people on low and fixed incomes, and damaging to energy efficiency and rooftop solar. Kentuckians deserve so much better than this. The KY Public Service Commission must open up its public process and reject this rigged deal.

Keep reading to learn some troubling facts about this case

The Kentucky Public Service Commission shut out groups representing low-income customers.

The PSC has gone to court to block public interest groups representing low-income Kentuckians from fully participating in this case. The PSC is a state agency whose job is to make sure monopoly utilities serve the public interest and charge rates that are fair, just and reasonable. But in this case the PSC allowed corporations like Walmart and Kroger to intervene, while blocking the Metropolitan Housing Coalition, Louisville’s Association of Community Ministries, the Community Action Council for Lexington-Fayette, Bourbon, Harrison and Nicholas Counties, and the Sierra Club from formally participating. All of these groups have a long history of participating in rate cases, and their exclusion by the KY PSC is unacceptable.

The LG&E and KU rate increases will hurt all customers.

Under this plan, the average LG&E residential electric customer will pay $7.53 more per month, a 7.5% increase. The average LG&E natural gas customer will see their bill rise by $7.14 dollars a month, a 12.2% increase. And the average KU customer’s monthly increase under this proposal will be $13.47, a 11.7% increase.

The LG&E and KU plan is rigged against low-income residents, energy efficiency and rooftop solar.

The utilities want to jack up the monthly service fee all customers pay for service, rather than further increasing the charge on energy used. For example: KU and LG&E want to raise fixed monthly fees for electricity service from $12.25 per month to $16.43 in most months, a 34% increase. And LG&E’s natural gas customers will see their fixed monthly fee jump from $16.35 to $20.15 in most months, a 23% increase. 

This approach makes it very difficult for low-income customers to manage their bills by conserving energy. No matter how little energy you use, you’ll still owe the monopoly utility an increasingly large amount just for basic service.

Shifting more of your monthly bill to the fixed monthly service fee is also a deliberate strategy by utilities to discourage customers from conserving energy or investing in rooftop solar. If you are forced to pay large, fixed monthly fees no matter how much energy you use, you are less likely to make investments or behavioral changes aimed at reducing your energy use. 

The LG&E and KU plan is rigged to conceal information from customers.

At the same time that LG&E and KU want to raise your monthly base rate, they also propose to make that charge invisible to customers. Instead, your bill will show the fixed monthly rate as a daily, rather than a monthly, charge. Do they think customers will be happier to see a fixed charge of $0.53/day than $16.43/month? Does the KY PSC think that’s in the public’s interest? 

The LG&E and KU plan is rigged to harm Kentucky’s homegrown solar industry.

This proposal from LG&E and KU also contains a poison pill. The utilities are proposing a deceptively simple change that seems designed as a back-door effort to kill solar net-metering, a state policy that makes space for Kentucky’s tiny but growing homegrown solar industry.

The utilities propose to divide their energy charge - the rate customers are charged for every kilowatt-hour consumed - into two parts: one smaller (a variable charge) and one larger (an infrastructure charge). This won’t affect the overall energy rate or the amount customers owe. It simply takes a single rate and divides it into two parts for “informational purposes.”

It’s not clear what informational purposes the utilities have in mind, since they don’t plan to reveal this change to customers on their bills. The sub-divided rates, if approved, will be found only in the fine print of KY PSC documents.

This appears to be a two-step process to end solar net-metering as we know it. In the first step, LG&E and KU are asking the KY PSC to put a stamp of approval on their questionable claim (made without evidence or an open process) that the energy charge is best thought of in two pieces, one smaller and one larger. In the second step, we can expect them to bring this PSC approved “information” to lawmakers, as they continue to argue (based on widely disputed assumptions about the value of rooftop solar) that solar customers should get credited for only the smaller portion. 

If the Kentucky Public Service Commission wants to open an administrative case to determine a fair “Value of Solar,” it should do so. That would allow for a broad range of stakeholders to intervene, a full and fair hearing of evidence, and a careful consideration of the costs and benefits of distributed renewable generation to the grid and non-participating customers. But it should not allow the agency or this rate case to be used by monopoly utilities to justify their opposition to solar net-metering without consideration of evidence or an open process.

(KFTC member Steve Wilkins has written a deep-dive article about this case and its effect on rooftop solar in Kentucky, for those wishing to understand more.