Kentucky lawmakers, Cameron raise concerns over Kentucky Power sale

(The Center Square) – Kentucky officials Thursday expressed their disapproval over a proposed sale of a utility provider in eastern Kentucky. In doing so, they cited fears residents in that region already slammed by out-of-control utility costs may face even higher bills for electricity.

Members of the Kentucky General Assembly’s Mountain Caucus gathered outside the State Capitol in Frankfort to spell out their concerns over American Electric Power’s planned $2.85 billion sale of Kentucky Power to Liberty Utilities.

Last October, the Canadian-based company agreed to buy Kentucky Power, which provides electricity to residents in 20 Kentucky counties. The sale requires approval of the state’s Public Service Commission.

However, the bipartisan group of representatives and senators said their region has endured a spike in utility prices over the last few years, coinciding with the closing of the Big Sandy coal-fired power plant in Lawrence County seven years ago. The Louisa-based facility now generates electricity through natural gas.

State Rep. Chris Fugate, R-Chavies, said people on fixed incomes receiving less than $750 a month are getting bills for their small homes that run up to $500 thanks to the add-ons included in their bill.

“Elderly people are having to choose between paying their electric bill and getting food or their medicines,” he said.

State Sen. Robin Webb, D-Grayson, said she has met with Liberty representatives. However, the former miner said she remains skeptical about how the company can provide affordable, reliable power.

“After reading the mission statements, how they plan on conducting business and the kind of company that they are, it gives me great pause in accepting this deal as is,” Webb said.

Lawmakers aren’t the only ones opposed to the deal.

In a letter released Thursday, state Attorney General Daniel Cameron also expressed his opposition. In particular, he’s concerned about Liberty’s planned green initiatives and focus on renewables. Cameron said coal and natural gas need to “play a vital role” in the state’s long-term energy needs.

He noted Liberty has promised short-term rate cuts but fears what may happen in the years ahead. Part of that concern is due to what his office has determined to be a $585 million “premium” in the acquisition of Kentucky Power.

“If the PSC disagrees with us and approves the sale, I hope it will make whole the thousands of Eastern Kentuckians who for years have struggled with unreasonably high rates and chronic underinvestment in their utility infrastructure,” Cameron said in a statement. “…The bulk of that overpayment would be better spent on rate credits for Eastern Kentuckians.”

A message to Liberty Utilities was not immediately returned on Thursday.

Speaking to reporters Thursday, Kentucky Gov. Andy Beshear said he understood the concerns of lawmakers and Cameron. Still, he hopes they will continue holding talks with Liberty.

Beshear, a former attorney general, said Kentucky Power has been in a “spiral” for years. The company has increased rates on people who live in some of the state’s poorest areas. That has then led to more increases and heavier burdens for local residents.

As it stands now, Beshear said Kentucky Power cannot be a reliable provider of affordable service to eastern Kentucky.

“Now it’s easy to say no to a move, but what’s the other move?” the governor asked. “So I’ll be anxiously awaiting the thoughts of the Mountain Caucus and the attorney general at what Kentucky Power can and should do now if the merger doesn’t move forward.”

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