Last week, both Smithfield and Clayton’s town councils approved the increases that will begin showing up on customers’ bills next month. The towns are members of the N.C. Eastern Municipal Power Agency, which recently approved a wholesale rate increase of 14 percent effective Aug. 1. Rising fuel and coal prices are to blame for the hikes, town officials said.

“In 2002, the coal cost $30 per ton, and now it is more than $100 per ton,” said Clayton Town Manager Steve Biggs. “For uranium in a nuclear plant, it was $20 per pound and now it is $135 per pound, so you can see the cost to produce electricity has increased significantly.”

The increase will cost Clayton an additional $1.1 million in electricity for fiscal 2008-09 — $880,000 more than budgeted. To make up the difference, the town will increase residential rates by 9.47 percent. Commercial customers rates will vary according to their class. Most of Clayton’s customers use 1,200 kilowatt hours per month. They paid $140.64 per month, but will now fork out $153.96, or an additional $13.32. Customers who use 15,000 kilowatt hours dished out $1,483.04 per month, but will now pay $1,649.54, or $166.50 more.

Eastern Municipal’s increase will cost Smithfield an additional $2 million a year. To recover the cost, the town will raise rates by 11 percent. A residential customer who uses 1,500 kilowatt hours per month will see an increase of $18.15, from $170.70 to $188.85. A commercial customer who uses 25,000 kilowatt hours will see a $302.50 increase each month, from $1,904.25 to $2,206.75. Neither of the estimates includes taxes.

Clayton Councilman Bob Ahlert said towns across the country are facing the same economic hardships. “If there is any hiccup at all in [Eastern Municipal’s] estimates as far as energy costs go, they will be back to us with other increases,” he said. “It wouldn’t surprise me if by the beginning of the year we are faced with another increase.”

“I know this comes at a tough time,” said Smithfield Public Utilities Director Earl Botkin. “We have a lot of people on fixed incomes who will unfortunately be affected. I don’t see any alternative for us.”

“Unfortunately, this is a sign of the times we live in now,” Smithfield Town Councilman Bill Jordan said. “As long as we charge exactly what it costs us, we have to do it. There is no getting out of it. It’s not our fault.”