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Rate increase for Huntsville Utilities passes

HUNTSVILLE, Ala.-The Huntsville City Council unanimously approved an electric rate increase for Huntsville Utilities Thursday.

The 2.75% increase is across the board, for all customers. It applies to consumption and also availability fees. For residents, the fixed availability fee increases by $0.29 and the average bill would increase by $4.00.

The rate increase was introduced in early January. It takes effect February 1, 2017. This plan is different from a proposal introduced that the Huntsville City Council voted down in April.

"We approved this rate increase because we've learned the art of compromise," explained Jennie Robinson, the council president.

For the company that's facing rising maintenance costs and servicing a growing community, the passage of this proposal is a relief in a way.

"It's vital to our community that we maintain our system and operate it efficiently," said spokesman Joe Gehrdes. "This has been a long time coming."

While supporters said they would gladly pay a few extra dollar to ensure quality service, opponents fear additional costs.

"I believe this would add additional hardship to the customers who are already struggling to pay their bills," explained one woman in a speech to the council.

"It's unpleasant and it's unpopular," acknowledged Gehrdes. "We know folks don't like rate increases. But in this case, it was very necessary."

The increase takes effect in February. If you are a Huntsville Utilities electric customer, you can expect it to be reflected on your next bill. To reduce your bill, Gehrdes says you can still reduce your consumption.

For more information about the rate increase, click here.

Gehrdes said he would like to say Thursday is the last time they will come before the council to ask for something like this. But he can't.

"Hopefully it will be a little while before we come back," he said, "but the signals that we're getting from the TVA is, we likely will be back in a couple years." He added the rate systems for utility companies are changing, and many of them are turning to increasing fixed costs instead of relying on variable consumption costs to earn revenue.