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BrightRidge holds the line on costs for customers despite inflation; Posts clean audit
JOHNSON CITY -- BrightRidge has directly discounted nearly $5.1 million in electric sales to its customers over the last three years, while maintaining well below national average electric rates, launching a Broadband division and assembling its 33rd clean audit in a row, according to the latest accounting review of the company by Blackburn, Childers & Stegall independent auditors.
Despite booming inflation that only now begins to show signs of slowing, BrightRidge has not raised the local portion of the electric rate in five years. That revenue pays for TVA wholesale power, local solar generation, distribution, maintenance and customer service.
“We have seen the cost of transformers skyrocket over the last few years, and virtually every product necessary to maintain reliable power to your home or business in the BrightRidge service area has climbed, including labor,” BrightRidge CEO Jeff Dykes said. “Maintaining a flat rate across the board locally is a true testament to the efficiency of our business as well as our commitment to providing low-cost public power to our customers.”
To aid its local power company customers that distribute its power at retail, the Tennessee Valley Authority dedicated millions of dollars back to LPCs as a Pandemic Recovery Credit to offset lost revenues and increased costs. Instead of keeping the funding, the BrightRidge Board of Directors voted unanimously to return $5.1 million (64.18 percent) to customers over the past three years.
Overall rates would be even lower were it not for TVA’s need to finance $15 billion in new production capacity over the next three years while hardening existing power plants from increasing weather impacts. TVA implemented a 4.5 percent rate hike in October to begin funding those projects.
TVA expects a 30 percent increase in electric demand in the years ahead in its seven-state service area, after more than a decade of mostly flat sales at both the TVA and local power company level.
For the fiscal year ending July 1, 2023, BrightRidge booked a 5.8 percent increase in sales revenue for the year, although much of this increase was due to elevated TVA Fuel Cost
Adjustment charges passed through to LPC customers. Fuel Cost charges have dropped back to historical rates in recent months as the cost of natural gas and coal fell.
For October, a BrightRidge residential or small commercial customer paid $0.1053 cents per kilowatt hour, well below the Bureau of Labor Statistics national average of $.1609 cents. Some West Coast cities were paying as much as $.30 cents per kilowatt hour, while costs in the Northeast were as high as $21.2 cents.
In all, BCS issued a “clean” opinion of BrightRidge’s finances, including the Broadband Division. Under Tennessee law, Broadband operates independent of the Electric Division balance sheet.
As such, Broadband has paid $11.4 million to the Electric Division for facilities, infrastructure and shared labor since the Broadband Division opened in 2019.
“The Broadband Division is operating as designed, generating new revenues for the Electric Division outside of the electric rate that allow us to offset electric rate pressure and keep electric costs down for our customers,” Dykes said. “Whether Broadband or Electric, our Board of Directors continues to reinvest in the systems that power your home and business.”
Outside of regular business, BrightRidge and TVA also have partnered to offer $5.9 million in incentives to home builders, expanding industries, and other large commercial/industrial business projects since 2017 to encourage regional growth.
Similarly, low-income homeowners have realized $2.7 million in BrightRidge and TVA funded local home improvements to help those customers improve energy efficiency and comfort in their homes through the Home Uplift program that began in 2021.
And all taxpayers in Washington County as well as BrightRidge served portions of Sullivan, Carter and Greene counties saw their government tax burden just a bit lighter as BrightRidge paid $6 million in taxes to those local governments in FY 2023 alone.