Utility Deposit for ELECTRIC Service Bond - Bowling Green Municipal Utilities in Kentucky

Brief Summary

BGMU requires commercial and industrial electric customers to post security equal to twice the average monthly bill before service starts, and its own rules name a surety bond as an acceptable guarantee in place of cash. For a business with a large monthly bill, a bond keeps that money working in the business instead of sitting on deposit with the utility.

Bowling Green Municipal Utilities requires a deposit or suitable guarantee, which its Rules and Regulations identify as a surety bond, equal to twice the average monthly bill before commercial or industrial electric service is established. For new construction or a change in the size or type of business, BGMU uses a load form to set the amount. The bond runs to BGMU and backs payment of the customer's utility bills.

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How to Apply for a Utility Deposit for ELECTRIC Service Bond:

• Apply for commercial electric service with BGMU and pay the $35 electric application fee.
• Ask BGMU for the required deposit amount, based on twice the average monthly bill or a load form for new construction or a changed business.
• Tell BGMU you will provide a surety bond in place of a cash deposit and ask for any bond form it requires.
• Have the bond written for the amount BGMU sets, with BGMU as obligee and the account holder's legal name as principal.
• Deliver the executed bond before service is established.
• Keep the bond in force while the account is open, and raise the amount if BGMU increases the deposit.

Detailed Information About the Kentucky Utility Deposit for ELECTRIC Service Bond:

The amount is a formula, not a fixed number

There is no single dollar figure for this bond. Section 2.A of the BGMU Rules and Regulations, approved November 2025, says a deposit or suitable guarantee (surety bond) equal to twice the average monthly bill will be required before commercial or industrial service is established. When a business is building new or changing its size or type, BGMU uses a load form to work out the required deposit. Get that number from BGMU first and have the bond written for it.

Commercial versus residential

The surety bond option appears in the commercial and industrial section. Residential deposits work differently. BGMU runs a soft credit check and asks for no deposit, one month's average bill or two times the average monthly bill depending on the result.

The amount can change

Under Section 2, BGMU may require any customer to increase the deposit to up to two times the average monthly bill based on pay history, inflation or actual usage. A customer may also ask in writing for the deposit requirement to be re-evaluated after twelve months of service. If usage grows, BGMU can ask for more security, which for a bonded account means a higher bond amount.

How a bond differs from cash

Cash deposits accrue interest at the rate BGMU earns on Electric Operating Fund accounts in local banks, and at termination they are applied to unpaid bills with any balance refunded. A surety bond does not tie up cash. If the customer leaves unpaid bills, BGMU can claim against the bond and the customer must repay the surety.

Other charges

BGMU charges a $35 application fee for electric service. Deposits are due at the time the application is accepted and are not transferable from one customer to another.

Eligibility and Requirements for a Kentucky Utility Deposit for ELECTRIC Service Bond:

• Bond amount equal to twice the average monthly bill, or the amount BGMU sets from a load form.
• Bowling Green Municipal Utilities as obligee.
• Principal name matching the commercial account holder exactly.
• Bond in place before service is established, under Rules and Regulations Section 2.A.
• Surety credit review of the business and its owners.

Kentucky Utility Deposit for ELECTRIC Service Bond FAQs:

Official and Additional Resources for the Kentucky Utility Deposit for ELECTRIC Service Bond: