CKY Market Review: Investing in renewable energy

Renewables and other innovations lowers cost, attracts businesses

By Robert Hadley

LG&E/KU’s 10-megawatt universal solar facility at the E. W. Brown Generation Station stretches across 50 acres of the plant’s property. (Courtesy of LG&E/KU)

Kentucky’s nearly 4.5 million citizens – not to mention its myriad hospitals, universities, manufacturers and hotels – are served by a robust energy, water and information infrastructure that is growing and adapting to meet the needs of its customers.

For Central Kentucky, energy comes from two sources: electric power and natural gas. Prominent players behind the electrical grid include LG&E and Kentucky Utilities (KU), and the Touchstone Energy and East Kentucky Power cooperatives. Natural gas is provided not only by LG&E, but also by Columbia Gas of Kentucky and Delta Natural Gas.

Lexington-based Kentucky-American Water serves multiple counties in the central corridor.

For telephone and high-speed internet service, providers include AT&T, Spectrum, Windstream and MetroNet. For wireless service, Central Kentucky customers turn to Verizon, AT&T, T-Mobile, Sprint and Bluegrass Cellular. Windstream and MetroNet are players of note in Central Kentucky for internet access.

Investing in renewable energy

Central Kentucky residents enjoy some of the lowest energy rates in the nation, nearly 20 percent lower than the national average, according to the Energy Information Administration.

Lexington-based Kentucky Utilities (KU) serves 553,000 customers across more than 77 Kentucky counties and five counties in Virginia. LG&E is based in Louisville. Together, the two utilities are part of PPL, a Pennsylvania based company that serves 10 million customers in four states and the United Kingdom.

LG&E and KU rely on innovation to help find ways to support and grow renewable energy and lower costs. Its Technology Research and Analysis team evaluates new technology to find ways to apply it to their operations.

The utilities are investing in renewable energy sources by adding more universal solar power to their electric grid. In August 2019, LG&E and KU opened a new solar facility in Simpsonville as part of its Solar Share Program. The first 1,400-panel array, already producing solar energy, is the first of eight 500-kilowatt sections planned for the Simponsville facility.

The subscription-based Solar Share Program is available to the utilities’ residential, business and industrial customers who want to support solar energy.

The Simpsonville solar facility is the company’s second in Kentucky. In 2016, the utilities unveiled Kentucky’s largest universal solar facility at the E.W. Brown Generation Station in Mercer County. It can produce 19,000 megawatt-hours of energy annually, enough to provide energy for 1,500 homes based on a usage of 1,000 kilowatt hours per month.

“This is another example of how utilities, including LG&E and KU, are investing in the future of the commonwealth and growing locally-produced renewable energy,” said Kentucky Energy and Environment Cabinet Secretary Charles Snavely. “These technologies are making our state a leading contender to retain and attract new business and meet the growing demands for a diverse energy future.”

LG&E and KU’s E.W. Brown Plant, near Harrodsburg, includes four generations of electricity-producing facilities – a hydroelectric plant, a coal-fired generating unit, natural-gas fired combustion turbines and the solar facility.


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PPL plans to invest about $5 billion in infrastructure improvements at LG&E and KU in the next four years, LG&E and KU President and CEO Paul Thompson told The Lane Report in a One-on-One interview in early 2019. Those funds will be used to make capital improvements, such as upgraded technology and replacing 50- to 60-year-old poles on high-voltage systems across the state and replacing them with steel, Thompson said.

East Kentucky Power Cooperative (EKPC), based in Winchester, is also investing in solar energy to help maintain the state’s lower-than-average electric prices.

In 2017, EKPC began operating a 60-acre solar farm in Clark County that features 32,300 solar panels capable of producing up to 8.5 megawatts of electricity, enough to power about 1,000 typical homes. EKPC customers can pay $460 for one of the facility’s 30,000 panels, entitling the customer to 25 years’ worth of power generated by that panel.

Nick Comer, Touchstone’s external affairs manager, said the company is committed to supplying sustainable and reliable energy as technologies change.

“We understand the crucial importance of reliable, affordable and sustainable energy for the 1.1 million Kentuckians we serve, as well as the state’s manufacturing industry, which is especially reliant on these features,” he said.

EKPC is spearheading a $262 million project to beef up its Maysville baseload plant, Spurlock Station, ensuring it meets strengthened rules regarding coal ash and water management, Comer said.

Comer explained that “maintaining generation diversity,” that is, multiple sources to serve one or more geographic areas, “is increasingly important to ensuring price stability.”

“EKPC recently bolstered its natural gas generation with the addition of the 567-megawatt Bluegrass Station in LaGrange,” Comer said. “In addition, membership in PJM Interconnection provides EKPC with access to the most affordable energy in a 13-state area, as well as a market for available generation.”

“We are investing in our transmission infrastructure to ensure it remains highly reliable, updating aging infrastructure while improving resiliency and security,” he added.

Ensuring clean, abundant water

Kentucky American Water, a subsidiary of American Water generating $93 million each year in revenue, has been funding an ongoing $20 million annual infrastructure campaign, according to Operations Vice President Kevin Rogers.

Evidence of the money spent was a $1.85 million water main extension in Clark County. The extension promises to “improve water quality and pressures” for neighbors in Athens-Boonesboro, Quisenberry, Waterworks, Old Stone Church and Combs Ferry roads areas.

To offset these cumulative costs, Kentucky American Water sought a rate increase, granted by the Public Service Commission in June of 2019. Said to support $100 million in new work since the 2016 rate increase, the new rates amounted “to a penny per gallon” for consumers.

High-speed internet fuels the data economy

Thanks to a $2 million Windstream investment, some 80,000 new households will have access to 50 mbps internet speeds through the company’s Kinetic internet service. Though fast, this speed pales in comparison to what is available to business customers, eligible for a 1 gigabit service that was part of $8.5 million in grid improvements across the country.

MetroNet, a supplier for the Lexington metro area, had activated a fiber-optic network capability as long ago as October of 2018. It offers internet, TV and phone services. At the time, then-Lexington Mayor Jim Gray touted the $70 million MetroNet spent on the fiber-optic reach as “a first step to making Lexington the nation’s largest gigabit city.”

In June 2019, MetroNet announced a “massive upgrade” to its system, enabling customers to have the same upload and download speeds without an increase in their monthly bills. MetroNet began constructing its fiber optic network in Richmond in August 2019.

Paul W. Thompson, Chairman, CEO and President

LG&E and KU Energy LLC

220 W. Main St.

Louisville, KY 40202

lge-ku.com

Consistently ranked among the best companies for customer service in the U.S. and recognized eight times as one of the top utilities for economic development by Site Selection magazine, LG&E and Kentucky Utilities Co. are committed to attracting and keeping businesses in the bluegrass and making the commonwealth a better place to live.

As the energy landscape continues to evolve, LG&E and KU are evolving with it. The utilities continue to create programs and offerings to help meet the goals of business and residential customers – including opportunities to support and grow renewable energy and installing publicly accessible charging stations to support electric vehicle adoption. Comprised of coal, natural gas, hydroelectric and solar, LG&E and KU maintains a diverse generation mix and rates among the lowest in the nation.

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