• 77°

SW EPA plans rate increase

Southwest Mississippi Electric Power Association customers willsoon be paying a little more for power as the provider nearscompletion of a system upgrade to improve service reliability.

Due to increased debt from a four-year, $21.9 millionimprovements project, association officials said a 7.6 percentincrease will take effect May 1 and will be seen on customers’bills next month. The increase follows a rate study that wasconcluded in February, said Percy McCaa, general manager of theLorman-based power association.

“We feel like this rate increase will carry us through at leastthe next five years and hopefully more,” McCaa said.

An EPA example indicated a residential customer who uses 1,000kilowatt hours (kwh) per month will pay an additional $5.54 permonth.

“The 1,000 kwh is about average for 12 months for theresidential consumer,” McCaa said.

Actual monthly totals, he said, are typically a little less, inthe 940-960 kwh range. However, he said the 1,000 kwh example wouldbe a little easier for customers to use to calculate the increasein their individual bills.

McCaa said the only other item that could affect rates would befuel costs, in particular natural gas expenses.

“If that fuel cost continues to go up, that cost will be passedon to the consumer,” McCaa said.

McCaa said a number of new plants being built in the state usenatural gas for generating power, which Southwest EPA thenpurchases for distribution to customers.

“That means demand is increasing for natural gas,” McCaasaid.

Southwest EPA serves approximately 3,200 customers in LincolnCounty. Overall, it has around 24,000 meters and maintains over4,100 miles of power lines in Adams, Amite, Copiah, Franklin,Hinds, Jefferson, Lincoln, and Wilkinson counties.

Since April 1998, the association has been pursuing a $21.9million work plan aimed at improving reliability. The plansincludes new substations, such as one that become operational inLoyd Star last year, and new distribution lines.

“This is the last year of the four-year work plan,” McCaa saidabout the activity that is scheduled to end in April 2002. “It’sall gone quite well.”

Work plan activity scheduled for this year includes a substationupgrade to double its capacity plus the reworking and addition ofnew power lines. McCaa said that work has been expensive, with workon each substation totaling over $800,000 and work on some powerlines costing $25,000 per mile.

The work plan does not include maintenance costs such as stormrecovery, general upkeep of the power distribution system andright-of-way expenses.

“That, of course, is continuing,” McCaa said, adding thatmaintenance costs have increased substantially over the last fewyears.

Following completion of the current four-year plan, McCaa saidSouthwest EPA will embark on a new work plan next year. He said itwill be only a two- to three-year plan.

“We’re not sure what that will entail,” McCaa said, adding thatplan options are being studied.