COVINGTON - City of Covington electric customers can expect an increase in their bills effective July 1.
While rates aren't going up, the PCA, or power cost adjustment, is increasing from 18.7 mils to 27.1 mils.
"MEAG's (Municipal Electric Authority of Georgia) budget projection went up 8.4 mils. That increases the wholesale costs we have to pay for power," said Utilities Director Bill Meecham.
The increase in electric bills will depend on a customer's usage. A customer with a monthly usage of 1,000 kilowatts will see an increase of approximately $8.40 per month, according to City Manager Steve Horton. A customer with a monthly usage of 2,000 kilowatts will see an increase of about $16.80.
The majority of the increase -- 5.8 mils -- is related to environmental compliance regulations set by the federal government.
"Regulations have come into play the last few years requiring scrubbers and other equipment on coal fire plants," Meecham said.
Horton said he'll ask the council at an upcoming meeting whether to include the environmental component as a separate line item on bills, so that customers are aware of the reason for the increase.
The PCA is how the city passes along the cost to purchase power to its customers rather than constantly changing rates. The PCA increases or decreases depending on the market, so customers aren't locked in, as they would be with a rate change.
In other news, the city approved a pilot program that will allow a dozen customers to test out prepaying for electricity. The program will allow the customers, who have yet to be identified, to pay for electricity as needed.
There may be a minimum amount required, but beyond that it would be up to the customer how much to spend, and that would determine how long the electricity stays on. Once they have nearly used up the electricity that their payment covers, they would be notified via email or some other method and then make another payment.
Currently, customers with a bad credit history must pay a deposit of up to $600. The pre-pay program would not require deposits or fees when the power has to be reconnected after being cut off due to non-payment.
The city is paying $4,500 to purchase the specialized meters required for the program.
Once a year is up, it will be determined if the program is feasible to offer to all eligible customers. While the cost of the meters will be absorbed by the city for the pilot program, it would be passed along to the customer if the program goes long-term.
The city would also need to buy new software and the associated credit card fees would also be higher. Those costs would likely be passed on to customers, as well.
Finally, the council agreed at its Monday meeting to deposit a refund of $855,345 from MEAG into an account to pay down expenses and debt related to the city's investment in the new Plant Vogtle, set to be operating by 2017.