Dalton Industries Face Big Utility Increases

Dalton, GA, Nov. 13, 2008--Electricity rates for Dalton Utilities industrial customers will rise 12 percent and rates for commercial customers will rise 11 percent on Jan. 1, according to a story in the Dalton Daily Citizen.

“The (board), recognizing the condition of many of our residential customers and the difficulty they are having with the (economic) downturn and the fact we did a significant residential rate increase last year, has decided they don’t want to do a residential rate increase this year on our electrical customers,” said Dalton Utilities president and CEO Don Cope.

The $186 million budget, up from a projected $166.8 million this year, includes a 20 percent across-the-board increases for water and wastewater services.

Board member Lamar Hennon noted it is a difficult time to be putting together a budget and making economic forecasts, given the uncertainty surrounding the floorcovering industry, the area’s largest industry.

Cope agreed, but he added that the budget had been put together based on the best information available from local manufacturers.

Cope said that since 1997 the utility has subsidized rates by around $172 million from its investment income. That’s how much less than the cost of providing those services customers have paid.

“We can’t afford to do that anymore,” he said.

Jim Bethel, CEO of floorcovering manufacturer J&J Industries, said he understands the board’s reasoning but worries about the effect the rate increases will have on local companies.

“I’m realistic enough to say the administration of the utility can probably clearly justify the dollars of this kind of increase. It just comes at an exceptionally unfortunate time for the industry,” he said.

The city of Dalton currently gets a transfer fee of 5 percent of gross revenues from Dalton Utilities, approximately $8 million this year.

“I am hopeful that the City Council will take notice of the fact they are receiving a windfall from increases of this size and would adjust downward their transfer fee,” Bethel said.

According to data provided by the utility, for instance, the average industrial customer will pay about 6.19 cents per kilowatt hour after the increase. The current national average is 7.42 cents per kilowatt hour.