A plan offered last week by mayoral candidate Don Cherry contains good points but wouldn’t reduce electric rates for Elizabeth City customers, an ElectriCities executive said Tuesday.

Cherry’s 10-point plan included recommendations regarding alternative energy, cooperation with other suppliers of electricity, and close regulation of rates.

“While all of those are excellent questions and excellent points, none of those would lend themselves to a reduction in rates,” said Ken Raber, senior vice president of ElectriCities Services/N.C. Eastern Municipal Power Agency.

Raber also responded in detail to some points about Cherry’s proposal in an e-mail message to The Daily Advance.

For instance, Cherry, an adjunct instructor at College of The Albemarle and a former city councilman, proposed requiring that any proposed rate changes by NCEMPA go before a state regulatory body with expertise in utilities, such as the N.C. Utilities Commission. Cherry says the board would provide an opinion regarding rates to the participating municipalities.

Raber suggested that that process would be unnecessarily cumbersome.

“Historically (state officials have) been of the opinion that the fact that municipal rate makers are elected officials is a sufficient check and balance on the reasonableness of their rates and their rate setting procedures,” Raber said. Adding state regulatory oversight — even in an advisory capacity — would add time and expense to the rate-setting process, he said.

Raber also pointed out the N.C. Local Government Commission has oversight of the debt issued by NCEMPA.

In an e-mail response to Raber’s critique of his plan, Cherry said local officials have limited options.

“It is my understanding that Elizabeth City is required to ‘take or pay’ for power furnished by the Power Agency,” Cherry said. “This leaves few options for local officials to absorb dramatic, consistent price surges from the power agency.”

Cherry, who served on City Council from 1995-99, also said it was his experience that it’s “difficult (for local officials) to say no to the rate increases which the power agency passes on to the city,” noting that the city doesn’t have the resources to do anything else.

“The electric fund balance for the city was established to absorb minimal shocks — not dramatic, consistent price surges,” he said.

Cherry also questioned whether it is reasonable to put local elected officials on a par with the Utilities Commission.

“It is certainly hoped that a governmental regulatory body such as the N.C. Utilities Commission would have more expertise in the utility area than a local council member,” he said. “It is not that local people are not capable of making decisions, but I think it would be far and few between the number of council members who have the staff and expertise to call upon such as a state agency (has).”

Cherry’s plan calls for seeking alternatives to ElectriCities as the administrative body for the power agencies.

Raber replied that it’s doubtful the Power Agency could employ another organization for what it currently pays ElectriCities.

“Since neither power agency has an administrative staff, an organization similar to ElectriCities, employing the same type of professional employees, must provide management services to the power agencies,” Raber responded. “ElectriCities, as an organization, strives to provide its management services to the power agencies at the lowest possible costs and it is doubtful that a new organization could provide the same management services at a lower cost, given the qualifications and experience of the ElectriCities’ staff.”

Raber pointed out that of NCEMPA’s budget of approximately $720 million, 1.4 percent goes to ElectriCities for management services.

Cherry said he still would like to look closely at the administrative services NCEMPA is buying.

“Dominion, Progress Energy, and Duke Power have comparable expertise,” Cherry said. “It would be interesting to know if they could provide these services at a cheaper rate than ElectriCities.”