Dominion increase to Franklin not as bad as anticipated

Published 10:04 am Friday, June 12, 2015

When the consultants first crunched the numbers for Power and Light Director Mark Bly, it looked like Dominion Power was passing on a 5.6 percent wholesale rate increase to the city. When the numbers were looked at again, the increase was actually 4.2 percent, which was even better than February’s 4.9 percent projected increase.

“I feel like I lied to you a week ago,” Bly said to the Franklin City Council on Monday. He mentioned there had been some turnover with the financial consultants. “The other fellows working on it were just not as experienced as we hoped.”

The “final final,” as the director put it, is actually good news for the department’s financial security. The city only approved a 4 percent increase to the wholesale rate for residents, and an additional 1.6 percent in expenses would have potentially had the electric department reaching into its own coffers to subsidize some of the power that residents use.

“I do apologize for causing anyone concern on that,” Bly said. “I just told you the information that I had.”

Ward 2’s Benny Burgess and Vice Mayor Barry Cheatham admitted that the effect this increase would have had on the utility’s capital and cash reserves account was a concern. Those funds exist in part to help the department avoid debt — which costs residents more in the long run — when purchasing equipment and for emergencies.

“At 5.6 percent, I couldn’t see how we’d maintain the cash flow,” Cheatham said. “That makes me feel better.”

Council approved the 4 percent increase to the retail rate in a 6-1 vote, with Ward 3’s Greg McLemore being the nay.

As has been previously reported, the 4 percent increase to light bills will still result in a decrease to customers. That’s because Dominion decreased its fuel charge by 42 percent.

Thanks to that decrease, the electric rate for Franklin customers started to decrease by an average of $8.80 in May for the use of 1,300 kilowatt hours. Starting in the July billing cycle, those savings will be bit into a little, but customers will still save. An average savings of $3.78 per month will still be in place based on a customer using 1,300 kWhs.