RED SPRINGS — Lumbee River Electric Membership Corporation is increasing its electrical rates by 4.78 percent, but customers should not see a major swell in their bills, according to spokesperson Walter White.
“The true impact in terms of rates is very nominal from where we were billing people,” White said.
White said the 4.78 percent rate increase will replace a temporary 5 percent increase, called a Wholesale Power Cost Adjustment, that was instituted in January.
“Before we make changes to our rates, if we’re seeing that we’re having a difficult time having the revenue flow that we need … sometimes we’ll put [a Wholesale Power Cost Adjustment] in and it will just be a temporary thing where it just goes up for a little while,” White said.
According to a statement from the utility, the rate hike was announced after the board of directors reviewed a study examining expenditures and revenue from the past few years.
“The results of this study show that Lumbee River EMC has done a good job of managing our costs over the past several years while positioning the cooperative to deal with the impact and pressures of a new wholesale contract with Duke Progress,” said Roger Oxendine, chairman of the utility’s board. Costs related to the contract, which allows Lumbee River to buy power from Duke Energy, have gone up, White said.
“About 70 cents out of every dollar we spend is actually for the electricity that we buy,” White said.
The average Lumbee River customer would see their monthly bill go from $146.65 before the 5 percent temporary increase to $153.66, according to the statement. The rate hike will be reflected on bills generated on or after July 1.
“We never like to find ourselves in a position where we have to increase rates. Rest assured that we here at Lumbee River EMC are working hard every day to provide you safe and reliable electric service at the lowest possible costs,” said Steven C. Hunt, the utility’s president and CEO.
Lumbee River EMC serves about 20,800 customers in Robeson County as well as about 3,000 in Scotland County, 16,000 in Hoke County, and 18,000 Cumberland County.
Hunt said the recent elimination of a 3.22 percent wholesale electricity tax by the state helped mitigate the need for additional revenue. The state has also increased sales tax on electrical from 3 to 7 percent, effective July 1. The wholesale tax had been built into rates offered by electric companies.
Residents can help keep their bills low by setting their thermostats to the highest comfortable temperature. In warm weather, each degree above 72 can save 7 to and 10 percent on electric bills, the statement said. Customers should also set their electric water heaters to 120 degrees.