Tucson CitizenTucson Citizen

Rate increase requested by TEP part of growing national trend



It’s no shocker that electricity bills are heading up – way up.

Utilities across the U.S. are raising power rates by up to 29 percent, mostly to pay for soaring fuel costs but also to build new plants and refurbish an aging power grid.

Mounting electric bills will further squeeze households struggling with spiraling gasoline prices.

“Consumers now face a tough reality on electricity,” said Mark Cooper of the Consumer Federation of America.

Rates have not increased in more than a decade.The spikes come after rising fuel prices have driven up utility bills nearly 30 percent in the past five years – the sharpest jump since the 1970s energy crisis. And fuel costs are again the main culprit.

Tucson Electric Power is asking the Arizona Corporation Commission for a 6 percent rate increase.

In Virginia, Potomac Edison, citing high coal and natural-gas prices, plans to raise rates 29 percent on July 1, pushing an average monthly residential bill from about $70 to $90. AmerenUE, Missouri’s largest utility, recently asked for its first rate increase in 20 years, a 12.1 percent boost, mostly to cover higher fuel costs. Customers of Public Service Company of Oklahoma were socked with a 25 percent hike this month.

The price of coal, which fires half of U.S. power plants, has doubled since last year, largely because of surging electricity consumption in countries such as China and India. Natural gas prices are up nearly 50 percent on high U.S. demand.

In California, a drought has forced Pacific Gas & Electric to replace cheap hydroelectric power with natural gas, prompting it to seek rate hikes totaling 13 percent.

Construction costs are also climbing. South Carolina Electric & Gas wants to boost rates 37 percent by 2019 to cover its share of two planned nuclear reactors costing $10 billion. The cost to build a new power plant has more than doubled since 2000.

Some utilities are seeking a double dose of increases. In New York City, Con Edison, after raising rates 4.7 percent in April, is requesting increases of 5 percent in each of the next three years to fund $5.5 billion for new equipment. That’s on top of an anticipated 13 percent rate increase this summer for higher fuel charges.

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