Lakeland Electric’s fuel rates spike to record levels, nearly double since June

LAKELAND — While the high price of gasoline is beginning to drop at the pump, Lakeland Electric customers can expect to see their fuel charges soar.

Lakeland Electric will raise its fuel rate from $60 to $75 per 1,000 kilowatt hours starting Sept. 1. The measure was unanimously approved by city commissioners on Monday morning.

The new fuel rate surpasses the utility’s high point of about $72.50 per 1,000 kilowatt hours charged in spring 2008. It’s also nearly double what Lakeland Electric charged in June. The rate rose from $40 as of July 1.

The average Lakeland homeowner can expect to see their monthly electric bill increase by about $15. The new, higher rate will be prorated, so property owners who receive bills in early September may not feel the full impact until October.

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Tory Bombard, the utility’s fuels manager, said Lakeland Electric’s fuel reserves would be fully depleted in September if the company did not raise its fuel rates due to the high cost of natural gas.

“To get to that threshold of $0 cash on hand by September is quite alarming,” Commissioner Stephanie Madden said.

Madden said the utility generally aims to have $29 million in its Fuel Reserves fund to cover emergency repairs or help recover from natural disasters, like a large hurricane.

Bombard said record-high temperatures across the nation this summer along with limited supply of natural gas in the region have continued to drive prices up, extracting a premium pay.

Two incidents are causing additional supply issues. On June 8, there was a blast that knocked out the the Freeport LNG, which transports liquified natural gas. A second source, the Transco pipeline is currently offline for a maintenance outage, according to Bombard.

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Because of these constraints, Bombard said the utility is being hit with an additional premium markup of anywhere from $1.25 to $8 above the industry’s index price for a unit of gas.

“No one expected the price of gas to go as high,” she said.

Lakeland Electric’s staff has promised to provide a monthly update on the fuel market to city commissioners under these conditions.

Customers concerned about their monthly bill are encouraged to set their thermostats to 78 degrees, as air conditioners are one of the most significant contributors to electrical use.

For more customized tips, customers can visit Lakeland Electric’s website for ways to save at lakelandelectric.com.

Sara-Megan Walsh can be reached at swalsh@theledger.com or 863-802-7545.

This article originally appeared on The Ledger: Lakeland Electric customers to see cost increase in monthly bill