Prompt Payment Discount Is Going Away - KCBD NewsChannel 11 Lubbock

5/25/06

Prompt Payment Discount Is Going Away

For more than a dozen years, power customers in Lubbock were rewarded for paying their bill early.  Now, times are changing.  On Thursday, Xcel Energy received approval from the Lubbock City Council to drop their prompt payment discount.

"We're having hard times.  Gas is going up, so we need as much help as we can get right now with electricity, and then it's hot.  We've got 100 degree temperatures out here," said Latoia Langston.  Right now, Xcel's residential customers receive a 2% discount if they pay their power bill early.  It may not sound like a lot, but listen to this.  In 2005 alone, Lubbock residents received more than $266,000 in discounts, but that is split between almost 19,000 households.  That means, those taking advantage of the discount program saved about $14 a year.

"I think that is wrong.  I think that was a great incentive for the city of Lubbock to pay their bills early," said Emily Bennett.  Xcel's Community Relation's Manager Steve Deaton says they're doing away with the discount because Lubbock is the only city in their service territory where residents are rewarded for early payment.  "Really, what we are trying to do is just make the playing field level for any and all customers we serve."

The break in price began back in December of 1993.  Deaton says it only came about because of competition from Lubbock Power & Light.  "You know what, I think they get enough of our money anyway," says Chana VanDevalde.  "That's a small percentage.  I think they should keep it," Bennett added.

Deaton says he doesn't think Xcel will lose many, if any, customers because of the change.  "I really don't see a big swing on this one way or another," Deaton said.

Xcel Energy is not alone.  Lubbock Power & Light tells NewsChannel 11 they are also looking to drop their early payment discount.  We spoke with Carol McDonald who tells us that LP&L will soon allow customers to pay their bill with a credit or debit card.  That service costs, and McDonald says dropping the discount is one way to absorb that cost.

McDonald says their looking at June 8th as their cutoff date, pending council approval.  LP&L has provided the early payment discount for the past 20 years.

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