Getting Electricity from Government

By Dick Hall-Sizemore

More than 300,000 Virginia residents and numerous commercial enterprises are not subject to the monopolistic electric rates of Dominion, APCO, or the electric cooperatives. They get their electric service from their local governments.

There are 16 municipalities in which electric service is provided by a governmental entity. Primarily, they are small towns (some surprisingly so) and small cities. They include the towns of Bedford, Blackstone, Culpeper, Elkton, Front Royal, Richlands, and Wakefield and the cities of Bristol, Danville, Franklin, Harrisonburg, Manassas, Martinsville, Radford, and Salem. Most intriguing of all is the Virginia Tech Electric Service, established by the university to provide electric service to the campus and the residents and businesses of Blacksburg.

These municipalities purchase most of their electricity from private companies such as American Electric Power Company. Several, such as Martinsville and Bedford, also use hydroelectric power for a portion of their needs.

According to the websites of some of these electricity services, it seems that most of them were formed around the turn of the 20th century, when electric service was not widely available in rural areas. This was one of the services the towns and small cities could provide to their residents, due to their population density.

These electric service programs are not subject to regulation by the State Corporation Commission. If the residents are dissatisfied with the rates or service, they can contact their town or city council members.

My Soapbox

As it often happens when I am poking around in data, I ran across a reference to something I was not expecting. In this case, it was city-supplied electricity services. Always interested in the services provided by local governments, I followed up and found out a little more. Given the interest on this blog with Dominion and electric power regulation, I thought it would be interesting to some readers.

These municipal electric service programs seem to be doing well. If their customers were not satisfied, these towns and cities are small enough that their complaints would carry weight with the governing bodies. There is even an active association for these power programs, the Municipal Electric Association of Virginia.

Before everyone gets too excited, these municipal power programs may not deliver electricity at a significantly lower cost than Dominion. I calculated what my cost of electricity in May would have been under Martinsville’s published rates. My cost under Dominion was only about two dollars more. Of course, in a year or so, after all the RAC’s that Steve has told us about, the story may be different.