The Enlightener

September 2007

Rate Adjustment: Typical Electric Bill
will be Lower

The typical household electric bill will be a little lower as a result of a rate adjustment being implemented by Blue Ridge Electric. The new rate adjustment is effective for September usage, which will be reflected on bills starting October 4.

The typical residential consumer will see a monthly savings of $2.47, which will help those households reduce their average monthly electric bill to $99.91.

Savings generated from wholesale power supply negotiations with the cooperative’s power supplier, Duke Energy, are being passed along to members and are credited for the overall bill reduction.

“As a community based electric cooperative, our mission is to benefit members with affordable electricity, delivered with the highest reliability and member care,” said Chief Executive Officer Doug Johnson. “I’m pleased we’re able to achieve more favorable wholesale power costs and benefit members by passing the savings along in a bill reduction.”

Sharing Fairly in Costs

Like much of the rest of the nation, Blue Ridge Electric is experiencing the challenge of an aging electric system. Many of the cooperative’s substations and transmission lines that provide the backbone of the system responsible for delivering electricity to consumers is reaching its lifespan since it was first built in the 1950s and 1960s. At that time, the cooperative only served around 15,000 consumers. Today, that number has swelled to exceed 70,000 consumers whose electricity needs have also more than doubled as technology has evolved, leading to more and more appliances and other energy-driven devices used in homes and businesses.

Electric utilities have a responsibility to have facilities in place that can meet the electricity needs of all consumers at the flip of a switch – from factories with substantial power usage to seasonal homes that use electricity for a few months of the year. Investment in electric facilities is very expensive, and requires a long-term investment in time and money.

The investment in facilities runs into millions of dollars and includes annually budgeted costs that reflect a dedicated effort to maintain the system so that it can reliably deliver electricity over many decades.

All utilities must recover from their consumers this “fixed cost” investment in facilities and services that ensure the system is in place and reliable to meet consumer energy needs, any time of the night or day.

Because the system must be in place to serve all members, of any size and at any given moment, we like to refer to our basic facilities recovery charge as a “fair share” cost in which all members share.

Due to major investments being made all across our system in substations and other electric facilities that are mandatory for delivering electricity to members, the basic facilities charge for residential consumers is being adjusted from $13.50 to $24.95. This is a monthly charge that is included in your total electric service bill. The amount was determined by a recently completed cost-of-service study, which analyzed the costs to serve our various consumer classes.

The good news is that even with this adjustment, the typical residential user will experience a slight decrease in their overall monthly bill due to the savings generated from the wholesale power savings.

While the typical member will see a decrease, members with seasonal or low monthly usage may experience an increase in their total bill due to this change. Because little or no electricity is being used by those with seasonal or low usage patterns, it has become difficult over the years to recover the appropriate amount from these members that ensures they pay their “fair share” of the investment in basic electric facilities. While seasonal usage members may use electricity only sporadically or in very small amounts, they benefit just like other members from having the facilities in place to meet their electricity needs at any time. Therefore, the basic facilities charge ensures all members pay their fair share of this investment.

Members with outdoor security (yard) lights may also notice a small adjustment in their monthly rate depending on when their light was originally installed. Some members may see a decrease in their monthly costs while others may experience a slight increase. Like most services, the cost of these lights has increased over the years and the adjustment is needed to assure everyone is paying their fair share for this optional service.

Because we’re a community based cooperative, we also provide assistance to our members who may need a helping hand on occasion. More details about these programs for qualifying members are available in our district offices.

The Perspective

An Editorial by Chief Executive Officer Doug Johnson

Lower Bills for Typical Households

I’m pleased to let you know that our membership will experience savings as a result of the upcoming rate adjustment taking effect on October bills.
These savings are possible due to more favorable wholesale power supply costs we have been able to achieve from our new wholesale power supplier, Duke Energy. As a member-owned cooperative, these savings are being passed along to those we serve. These savings will result in a $2.47 savings on the typical household bill.

I am especially pleased we’re able to provide this reduction during a time when our nation is experiencing increased costs for many consumer goods, including energy products. Our last rate adjustment was in 2004 and barring any unforeseen wholesale power supply issues, we should be able to provide stable electricity costs to our members for the next several years.

We will also continue to hold down costs by operating efficiently and utilizing new technology to continue our focus on power reliability, which resulted in our ability to keep the lights on 99.98 percent of the time in 2006. While we work to hold down costs, we remain committed to providing value to our members and remaining one of the top ranked customer service utilities in the United States according to the American Consumer Satisfaction Index in which members rated us a full 12 points higher than the industry average.

We’ll also continue to be a resource to members wanting to understand the impact their usage has on their energy bills and to provide energy saving resources on our web site and in our district offices.

As a community focused electric cooperative, we also remain committed to helping those members who may need a little extra assistance paying their energy bills. Through our Members Foundation, we have resources available to qualifying households that are designed to provide assistance for members in need of a helping hand.

At Blue Ridge Electric, our goal is not only to bring you the best power reliability and customer service, it is also to provide our members with the most affordable rates possible. I’m pleased we are able to provide value to our membership by offering an overall bill reduction while at the same time bringing you the most reliable power, delivered with nationally recognized customer care.

Meter Tampering:
Dangerous and a Crime

Tampering with meters to divert power can lead to dangerous – and even deadly – consequences. Energy is flowing into the meter area and when a meter is tampered with by someone other than an electric utility professional, the result can be a fire, explosion, or even electrocution of the individual tampering with the meter.

Blue Ridge Electric, like other utilities, is beginning to see an increase in power theft through meter tampering. The cooperative’s service rules and regulations require us to issue a $300 fee at any time tampering is discovered. The electric service must remain disconnected until the meter tampering and reconnect fees are paid in full to the cooperative. Additionally, the cooperative has the legal right to seek criminal prosecution against those who tamper with a meter to reconnect their electricity. The cooperative can reinstate power once the member has paid their account in full.

Please understand that it is a crime and extremely dangerous for anyone other than a trained Blue Ridge Electric employee or an authorized contractor of the cooperative to break a meter seal or reconnect a meter. This is why Blue Ridge Electric and the State of North Carolina take the act of meter tampering so seriously.

If you see evidence of meter tampering, please contact Blue Ridge Electric.

Published monthly by Blue Ridge Electric Membeship Corporation for its 72,188 member consumers.