OWENSBORO, KY (WFIE) -
Owensboro Mayor Ron Payne says when he heard OMU wanted to raise rates by 9.6%, he decided the city had to do something.
On Tuesday, city leaders and utility officials went public with a plan to ease the burden on customers.
OMU isn't making enough money selling power right now, so the company has decided to explore all options.
Last week, OMU said it was possibly raising its utility rates by 9.6% by January 2013. The average customer would pay an extra $10 a month for power.
"It's getting harder for the average utility customer to come up with that kind of money. They didn't get what they wanted and they're going to find a way to get it," said customer Steven James.
"Increases to the ECA will impact the quality of life for every Owensboro family," said Payne.
The city thought 9.6% was too high. After meeting with OMU on Tuesday, Mayor Payne announced the possible rate increase would be cut in half.
"OMU has agreed to place the second phase of the ECA adjustment originally scheduled to go into effect in January on hold until this study and analysis is complete," said Payne.
The study Mayor Payne is referring to will be conducted by OMU in partnership with the city and an independent consulting firm. It'll look at ways OMU can make up for money they've lost by not selling enough power in the wholesale market.
"The wholesale market that we're dealing with. It's absolutely in the tank. That excess power price is now being set by natural gas, not by coal. Are there other products for instance besides energy that we can be selling into the wholesale market. Do we buy power on the open market?" said Dean Jones of OMU.
When asked if the salary increase for OMU employees is a done deal or if they plan to look at that, Jones responded, "Like I said, everything that we're doing is on the table."
Officials say there is no timetable yet for when the study will take place.
Again the 4.8% rate increase in July is still a possibility. OMU will vote on that May 17.
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