Craig-Botetourt Electric Cooperative to reduce rates 

Customers of the Craig-Botetourt Electric Cooperative will see a 5.2 percent decrease in their monthly power bills, the utility announced Friday.

A decline in the wholesale cost of power that the cooperative purchases from larger utilities was cited as the reason for the rate reduction.

Craig-Botetourt has about 7,000 members in the counties of Alleghany, Botetourt, Craig, Giles, Montgomery and Roanoke. For the most part, it serves rural areas out of the reach of Appalachian Power Co., the region’s dominant utility.

Even with the decrease, Craig-Botetourt customers will still pay more than those served by Appalachian.

Craig-Botetourt’s residential rate for 1,000 kilowatt hours, the average monthly amount for a home, is $135. Appalachian’s rate is $109.80.

In fact, Craig-Botetourt had the highest rates in the state in January, according to an analysis of 33 utilities by the Virginia attorney general’s office. Because rates can fluctuate, especially with smaller utilities, it is not clear how Craig-Botetourt currently ranks.

Appalachian ranked 15th in the state in January.

Larger utilities, with more residential and high-paying business accounts, generally benefit from economies of scale not available to smaller ones.

For example, Craig-Botetourt has an average of 5.2 customers per mile of power line, while Appalachian has 17 customers per mile. So if for some reason that mile of power line had to be replaced, the cost would be greater for Craig-Botetourt customers.

And when it comes to buying electricity from larger utilities, the cooperative says it has little control over the costs.

Craig-Botetourt gets about 50 percent of its power from Appalachian, 45 percent from Dominion Virginia Power and the rest from Southeastern Power Administration, a network of hydroelectric power.

Shawn Hildebrand, the cooperative’s general manager, said he hopes that rates will continue to drop as part of an effort to bring prices in line with other utilities.

After several years of increases due to federally mandated pollution controls, Hildebrand said, “It is good to be able to offer some relief during these trying economic times our members have faced recently.”

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