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Rocky Mount, Wilson residents got a double electric bill whammy last winter – why?
Some of the highest electric bills in the state have been arriving at homes in some of the lowest income northeastern North Carolina cities and towns. It’s no coincidence that those municipalities are among those who decided to operate their own city utilities and distribution system, getting power in bulk from Progress Energy originally based on shares of debt they took on for new power plants years ago. That arrangement was called N.C. Eastern Municipal Power Agency, and the 32 member cities with their own utilities are called ElectriCities. Power bills in municipal utility areas of Wilson and Rocky Mount can be 50% higher per kilowatt hour than those of direct Progress Energy customers. Gas prices through the city utilities can be 30% higher than direct service from PSNC. What gives?
Last fall, some folks from Alliance for NC SAVE$ ENERGY were invited by a group of Rocky Mount activists outraged by their high utility rates, especially unaffordable in low income neighborhoods. Residents have reported bills in the $400 to $800 range for even small homes, and are threatened with utility cut offs. When the 32 cities agreed over 3 decades ago to finance part of the debt for the new power plants, they were allowed to create city “enterprise funds” which are not subject to rate regulation by the state’s Utilities Commission, and include improvements to their distribution system.
Furthermore, with permission from their city councils, the cities’ utility rates can include public service costs for roads, parks and vehicles that are normally covered by taxes in other cities without local utilities.
Rocky Mount, Wilson and other ElectroCities are not prosperous, and, along with a history of paying off the power plant debt very slowly, the rates the city utilities are charging have risen far more quickly in recent years than those of regulated utilities. Inner city customers served by the municipal utilities say that their rates are actually helping to subsidize public services to newer outlying communities hooked directly to Progress Energy, facing lower electric bills.
The Rocky Mount and Wilson activists have started a campaign to stop all utility cut offs, and are investigating other strategies to establish more equitable policies for city utilities, working with the NAACP’s involvement. Some cities tried unsuccessfully in the past to drop out of the Eastern Municipal Power Agency, but their debt obligation prevented it, so the injustice continues. A combination of tighter fiscal discipline by cities, finding the political courage to move public service costs from utility charges to more equitably based taxes, and debt relief will be needed to get more affordable rates for some of our state’s hardest hit residents.