Wake Forest Power customers to see electric rate increases in April & September
For the first time in two years and only the fourth time since 2008, Wake Forest Power (WFP) is raising electric rates. During Tuesday’s monthly meeting, the Board of Commissioners (BOC) voted unanimously to raise residential rates 9.5 percent in both April and September, and small and large commercial service rates 8 percent and 5.4 percent, respectively, in April.
The impact of soaring equipment and materials costs, compounded by severe supply chain issues and a string of mild winters, led commissioners to concede that the rate hike, though unpleasant, was necessary.
Three years ago, primary cable cost $7.24/foot compared to the current cost of $19.42/foot. Over the same period, 167 KVA transformers which were $3,764 with a 12-week wait for delivery now cost more than six times as much at $25,567 with more than 10 times the wait for delivery at 140 weeks.
Armed with this information during their January retreat, commissioners also learned that without a rate hike, WFP could face a deficit of as much as $12 million within three to four years.
“We haven’t raised our rates in a long time,” said Commissioner Chad Sary during Tuesday’s meeting. “This (rate increase) is to get us whole. This money will be used to support the people (WFP customers) who are receiving the service. I don’t know that we have any other choice.”
“We have to balance the check book,” said Commissioner Jim Dyer.
A division of the Town of Wake Forest, Wake Forest Power operates as an enterprise system. As a result, no taxpayer dollars are used to subsidize the not-for-profit utility. Instead, electric rates are set to cover operating expenses and costs associated with providing reliable electric service.
On the residential side, the rate adjustments mean that a customer using an average of 935 kWh per month who is now paying $126.87 a month ($1,522.42/year) will pay approximately $10 more per month in April ($136.55/month and $1,638.55/year) and another $10 more per month in September ($147.14/month and $1,765.71/year).
These increases come just over two years after commissioners delayed a suggested rate hike due to the impact of COVID-19. In December 2020, Booth and Associates presented to the BOC the results of a Cost of Service & Rate Study which recommended a 4 percent rate increase. The BOC agreed to discuss the rate adjustment in April 2021, at which time it agreed to delay implementing the increase until September 2021.
Booth and Associates updated the Cost of Service & Rate Study in February 2023 to account for increases in providing electric service. For more information, contact Chief Financial Officer Aileen Staples at 919-435-9461 or [email protected].