Letter to the editor: With electricity costs rising, local utilities should tap into federal clean energy funds

Both New River Light and Power and Blue Ridge Energy could mitigate the impact of current and future spikes in gas prices by tapping into new federal resources recently approved in the Inflation Reduction Act.

The IRA includes billions of dollars in grants, incentives and loan guarantees for non-profit utilities to invest in renewable energy, battery storage and energy efficiency. These upgrades will reduce costs for utilities, hedge against future gas price spikes, lower customer bills, and generate substantial local economic benefits for the High Country.

Both utilities have raised rates this year to account for the rising gas prices. In July, New River received approval for a 24% rate increase specifically to cover higher gas prices. That increase took effect August 1. A few weeks ago they requested a second rate increase, again because of higher gas prices, which will take effect in March 2023.

Overall, New River’s rates will have increased more than 50% in a year due to its reliance on a single gas plant and the price spike. New River is also expected to file a general rate case soon, which could further impact customer bills. Blue Ridge instituted a 2.4% rate increase for residents in October and will begin adding a Wholesale Power Cost Adjustment Fuel Charge onto members’ bills beginning in February 2023, covering higher fuel costs for electricity generation. That new charge that will further raise rates possibly to a significant degree, although we won’t know until it happens.

While contractual limitations may restrain the amount of large-scale renewable energy resources Blue Ridge can obtain, the co-op is free to pursue smaller projects and expand its energy efficiency options for members, and should do so by leveraging new funds from the IRA. For New River, however, its contract with Carolina Power Partners gives the utility the option to invest in energy efficiency and pursue as much utility-scale solar as it wants.

In fact, the North Carolina Utilities Commission expects to see such proposals in New River’s upcoming rate case. For the time being, the utility has been offering clean hydropower to customers through the Green Power Program. But New River could the new IRA funds to diversify the utility’s power purchases with utility-scale solar and incentivize customers to invest in rooftop solar and energy efficiency. They can also enable customers through supportive programs and fair compensation for customer-owned generation to take advantage of incentives available to them through the IRA.

In the meantime, the Town of Boone, which is served by both electric utilities, has been a leader in advancing clean energy to reduce costs and address climate change. The town is seeking other opportunities to invest in renewable energy while also embarking on a community climate action plan and developing resources to aid residents and businesses interested in going solar through the town’s Solar Power page on its website.

But the town can’t do it alone. New River and Blue Ridge should take immediate steps to tap into the new IRA funding to invest in renewables, offer energy efficiency solutions to their customers, and spur local economic development. Local residents and businesses should expect nothing less.

Rory McIlmoil is a Senior Energy Analyst for Appalachian Voices.