Kentucky’s Electric System: Then, Now, and What’s Next
Before 1999 — The Old System
Kentucky had one electric company per area, and the Public Service Commission (PSC) made sure prices were fair.
- The PSC set all rates.
- Each utility was responsible for everyone in its territory.
- Power plants, lines, and service were all part of the same company.
- Customers didn’t choose a provider — but rates were steady and service was reliable.
Think of it like one water company serving your town, with the state checking the bill to keep it fair.
After 1999 — The Deregulated System
The 1999 Utility Act changed that. It tried to make electricity work like a free market.
- Multiple suppliers could sell electricity.
- The PSC’s control was reduced.
- Prices could change based on the market.
- Some areas saw higher bills or confusion about who provided power.
It was meant to create competition, but it also made the system harder to manage and less predictable.
Your plan keeps the choice of multiple utilities but brings back strong rate control through a new Public Access Commission (PAC).
- Several utilities can operate statewide.
- The PAC sets and approves all rates, just like the PSC used to.
- Customers can choose their provider, but prices stay fair and uniform.
- The PAC enforces service quality and reliability.
In short:
“More choices for who provides your power — but one public board still makes sure nobody overcharges.”
001 AN ACT relating to electric utilities and establishing a Public Access Commission.
002
003 Be it enacted by the General Assembly of the Commonwealth of Kentucky:
004
005 SECTION 1. A NEW SECTION OF KRS CHAPTER 278 IS CREATED TO READ AS FOLLOWS:
006
007 (1) The General Assembly finds that:
008 (a) The 1999 Electric Utility Industry Restructuring Act reduced regulatory oversight;
009 (b) Kentucky’s electric consumers benefit from public rate control and reliable service;
010 (c) It is in the public interest to restore rate regulation while allowing multiple utilities
011 to operate under uniform standards.
012
013 (2) The purpose of this Act is to:
014 (a) Repeal the deregulated market structure created by the 1999 Act;
015 (b) Authorize multiple electric utilities to operate within the Commonwealth;
016 (c) Establish a Public Access Commission (PAC) to set and approve all retail electric rates;
017 (d) Ensure fair pricing, reliability, and consumer protection statewide.
018
019 SECTION 2. REPEAL OF THE 1999 ELECTRIC UTILITY INDUSTRY RESTRUCTURING ACT.
020
021 (1) All statutory provisions enacted or amended by the 1999 Electric Utility Industry
022 Restructuring Act are hereby repealed in their entirety.
023
024 (2) The Legislative Research Commission shall identify and strike all affected sections
025 within KRS Chapter 278 and related chapters.
026
027 SECTION 3. ESTABLISHMENT OF THE PUBLIC ACCESS COMMISSION.
028
029 (1) There is hereby created the Public Access Commission (PAC), composed of five (5)
030 members appointed by the Governor and confirmed by the Senate.
031
032 (2) The PAC shall:
033 (a) Set and approve all retail electric rates;
034 (b) Review cost‑of‑service filings from all utilities;
035 (c) Conduct public hearings before rate approval;
036 (d) Enforce reliability and service standards;
037 (e) Certify utilities to operate within the Commonwealth.
038
039 (3) The PAC shall promulgate administrative regulations to implement this Act.
040
041 SECTION 4. AUTHORIZATION OF MULTIPLE UTILITIES.
042
043 (1) Electric utilities may operate within non‑exclusive service territories upon PAC approval.
044
045 (2) Each utility shall:
046 (a) Maintain adequate generation and distribution capacity;
047 (b) Comply with PAC reliability and safety standards;
048 (c) File tariffs and rate schedules for PAC approval;
049 (d) Provide universal service to all customers within its area.
050
051 (3) The PAC may authorize overlapping service territories when doing so promotes
052 competition in service quality and reliability.
053
054 SECTION 5. RATE‑SETTING FRAMEWORK.
055
056 (1) All rates shall be just, reasonable, and non‑discriminatory.
057
058 (2) The PAC may establish:
059 (a) Uniform statewide rates; or
060 (b) Utility‑specific rates based on cost‑of‑service data.
061
062 (3) No utility may charge or collect any rate not approved by the PAC.
063
064 SECTION 6. CONSUMER PROTECTIONS.
065
066 (1) The PAC shall ensure:
067 (a) Universal access to electric service;
068 (b) Fair billing and disconnection procedures;
069 (c) Complaint resolution and enforcement authority;
070 (d) Transparency in rate filings and hearings.
071
072 SECTION 7. TRANSITION PROVISIONS.
073
074 (1) Existing competitive supplier contracts shall remain valid until expiration.
075
076 (2) All utilities shall submit updated tariffs to the PAC within one hundred eighty (180)
077 days of the effective date of this Act.
078
079 (3) The PAC shall issue transition regulations to ensure continuity of service and rate stability.
080
081 SECTION 8. EFFECTIVE DATE.
082
083 This Act shall take effect ninety (90) days after adjournment unless an emergency clause
084 is enacted by the General Assembly.
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