KUB customer on fixed income braces for rate increase ahead of major upgrades

Local News

KNOXVILLE, Tenn. (WATE) — Knoxville Utilities Board crews will soon begin work on a major upgrade to its service network. The plan includes installing new technologies, adding fiber, and offering electric customers another service option for high-speed internet. The project is estimated to be completed in 10 years and cost more than $700 million.

Some customers could begin connecting to the municipal broadband service as soon as next summer; however, all customers will see an impact to their monthly bills starting next year.

The investment plan includes a 3% rate increase in 2022, 6% the following year, and ultimately 9% in 2024. Stephanie Midgett, with KUB’s Communications and External Relations division, said added revenue from the broadband service will help stabilize rates for the next seven.

Through the use of “smart” technology, she explained, their power service will be more reliable, resulting in customers experiencing fewer outages. Installing switches and fiber, she further explained, will help reduce the number of people impacted by a weather event, or car accident, and allow for faster response times.

“This is an electric systems project first and foremost,” she said. In fact, KUB officials were already planning upgrades to their system, and adding fiber, regardless of whether their public broadband proposal was approved by city leaders. That route would have also resulted in an increase for ratepayers. “Even if you’re someone who does not ever plan to have broadband services through KUB, you’re still going to benefit from this new program. You’re going to benefit because electric reliability is going to go up, we anticipate between 44 to 50 percent,” Midgett added.

Jerry Downs cannot afford existing providers and doesn’t think he’ll be able to afford KUB’s service. A 3% rate increase isn’t in the budget either.

He earns fewer than $1,000 every month in disability benefits. After rent, his phone, and his KUB bill are paid he’s often left with nothing, or in the red. “During the winter, I had to take out title loans to pay KUB because my bill went from 120 to 130 dollars, to 300 to 400 dollars a month,” he said.

KUB officials estimate on year three of the rate increase, an average household will see an uptick of $10.80 on their monthly bill. That’s no small number for Downs.

“That’s like 100 dollars to me. I don’t have it. I can’t afford it,” he said. While he understands the investment will have benefits outside of the broadband service option, he is more concerned with affordability than reliability.

Tiffany Martin, KUB’s Chief Customer Officer, explained there are resources available for those experiencing financial issues, including delaying payments, actual financial assistance, and long-term solutions like weatherization.

“We want to help those customers that are struggling. So, I would encourage Jerry, and others who are struggling with bill payment to call us. Our goal is to connect them with programs and resources that can help,” Martin said.

At the same city council meeting this week where the KUB proposal was approved, council also passed a measure allowing Mayor Indya Kincannon to execute an agreement with the utility to provide funding for a proposed low-income internet program.

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