Prepare for higher electric bills

CORNELIUS – The manager of the ElectriCities utility for Cornelius has recommended the town increase power bills for residents and businesses by 8.5 percent by July 1.

Huntersville commissioners will get the same request at a budget workshop in February, Craig Norfolk, ElectriCities manager, said last week.

Norfolk gave a financial presentation to Cornelius commissioners Tuesday, Jan. 19, as a preview of commissioners’ upcoming budget deliberations. The rate increase, averaged over 12 months, would add about $7.15 monthly to most residents’ bills. Most of the towns’ customers use 1,000 to 1,200 kilowatts of power a month, and ElectriCities currently charges residential customers about $85 for 1,000 kilowatts of power.

If the two town boards approve the measure, that would be the first general rate increase for ElectriCities customers in Cornelius since 1997. After the towns merged their  ElectriCities operations in 2000, ElectriCities customers have received two rate decreases totaling 16 percent, Norfolk said.

Even with the increase, ElectriCities’ residential customers would still pay 2.5 percent less than Duke Energy charges its customers and 9.5 percent less than customers of Energy United, Norfolk said.

Still, Commissioner Jim Bensman asked if the town might approve the rate increase in two phases because so many individuals and businesses continue to struggle economically. “Residential bills are not that high, but it (the electricity costs) can be substantial for businesses,” he added.

At Bensman’s request, Norfolk said he would provide commissioners with more detailed financial statements.

The towns’ electric utility has been able to avoid rate increases for years largely because of the towns’ rapid growth and the 2000 merger that enabled the towns to share resources, Norfolk told Cornelius commissioners.

ElectriCities spends 80 percent of its budget buying power from Duke Energy’s Catawba Nuclear Station, in which ElectriCities’ towns have partial ownership. In recent years, the utility has absorbed wholesale electric rate hikes from Duke, but the towns’ utility has reached a point where “expenses are greater than revenues,” Norfolk said, and for the past five years, the utility’s operating margin has been “none or negative.”

Plus, Cornelius will soon need to make almost $2 million in capital improvements in the next four fiscal years, including:

• System improvements to anticipate the growth  of the large Antiquity development at Catawba Avenue and Main Street and Bailey’s Glen subdivision at Bailey Road and N.C. 115.
• Maintenance upgrades on an existing substation, adding capacity to another substation and planning and constructing a new substation.

Huntersville will likely have to spend even more on equipment to serve the massive Bryton development, which has announced plans to move forward with construction, Norfolk told Cornelius commissioners.