EPB board of directors
EPB’s board of directors on Friday morning approved a 3.5 percent increase in electric power rates effective July 1 "to cover increases in operating costs to deliver electric power."
The new rates apply to EPB’s residential, commercial and smaller industrial customers.
Officials said, "This adjustment will help offset the rising costs of recovering from more frequent severe weather events and the effects of large monthly temperature fluctuations on the peak energy demand charges that EPB pays to the Tennessee Valley Authority for generated power."
For residential customers who use a monthly average of 1,000 kWh of electric power, this adjustment will reflect an increase of about $5 on their monthly bills, which does not include the monthly fuel cost adjustment that TVA passes through to customers. The 3.5 percent change includes increases to EPB’s base energy rate and the fixed monthly customer charge.
This is EPB’s first electric rate increase since 2011. Payments from EPB’s Fiber Optics division to the Electric Power division for use of the smart grid’s fiber network have allowed EPB to defer rate increases that would have totaled five percent over the last four years, it was stated.
“We work hard to provide the best possible value to our customers, but we can’t control the external factors that drive increased energy costs,” said President and CEO Harold DePriest. “I believe that with this rate adjustment, we’ll be able to hold the line on electric rates for several years.”
The EPB board also approved the refinancing of $240 million of the utility's $264 million debt.
Greg Eaves, finance director, said the interest rate will be dropping from 4.38 percent to 3.2 percent, bringing a total savings of nearly $16 million in present value.
The debt is callable in 2016-2018.
At the same time, EPB is borrowing $30 million to go toward its capital needs.
Officials said EPB currently has 67,700 fiber customers. That venture has brought in $15.3 million in the first 11 months of the fiscal year.
It was announced that EPB has paid off its debt on its telephone service.