<h1>Appalachian Power Company and Wheeling Power recently filed a request with the Public Service Commission of West Virginia for a $114.6 million revenue increase. If approved, the request would raise rates in West Virginia by 7.85 percent.<\/h1>\r\n\u201cToday we submitted a request to the Commission in which we present our costs of providing safe and reliable electric service to our customers,\u201d said Chris Beam, Appalachian Power president and COO. \u201cIt includes the cost of maintaining and improving utility infrastructure, higher state and local taxes, a reduction in federal income taxes and significantly lower customer usage.\u201d\r\n\r\nApproximately half of the requested increase is due to a significant decline in the amount of electricity used by customers. Traditionally, revenue from increasing customer usage has been used to offset some increases in the cost of doing business, thereby lessening the need for rate increases. However, customer usage has been declining for the last several years. For residential customers as a whole, electricity usage has dropped by 14 percent since 2013. The number of residential customers has also declined, dropping by 11,000 since 2013.\r\n\r\nAlso driving the need for increased rates, the company has made major infrastructure investments in the last several years. These include investments in generation facilities, the transmission system serving the region, and distribution facilities, including upgrades to the underground distribution networks in Huntington, Charleston and Wheeling.\r\n\r\n\u201cWe continue to invest in our transmission and distribution network to ensure that service remains reliable,\u201d Beam said. \u201cOur goal is to balance our customers\u2019 service expectations with the need to keep prices as low as possible.\u201d\r\n\r\nThe company\u2019s filing reflects the lower federal income tax rate and other benefits of the Tax Cuts and Jobs Act of 2017.\u00a0 These changes in federal income taxes reduced the company\u2019s request by approximately $52 million. The company also recently filed a proposal to use additional federal tax reform savings to offset almost $132 million in unrecovered fuel and vegetation management costs, allowing rates for those charges to remain unchanged.\u00a0 Additional federal tax reform savings will be addressed in a separate ongoing Commission proceeding.\r\n\r\nWhile the company requested a June 8, 2018, effective date for its proposed tariffs, rates will not be put into effect until approved by the Commission, which can take up to 300 days to make its decision.\u00a0 The average monthly bill for the various classes of customers will be changed as follows:\r\n\r\nIncreases by Class\r\n\r\nClass $ Increase % Increase\r\n\r\nResidential $14.81 11.1%\r\n\r\nCommercial $42.43 11.5%\r\n\r\nIndustrial $1,960.00 1.1%\r\n\r\nOther\u00a0\u00a0\u00a0\u00a0\u00a0 $1.18 11.9%\r\n\r\nThe company is proposing changes to its rate structure that would help to reduce high winter electric heating bills and seasonal bill volatility for residential customers.\r\n\r\nThe filing requests a 10.22 percent authorized return on equity. Earning a fair return on equity is critical to the company\u2019s ability to do business. It directly affects bond ratings and therefore the cost to finance infrastructure improvements, make long-term investments and provide reliable electricity.\r\n\r\nAppalachian Power has 1 million customers in Virginia, West Virginia and Tennessee (as AEP Appalachian Power). It is a unit of American Electric Power, one of the largest electric utilities in the United States, delivering electricity and custom energy solutions to nearly 5.4 million customers in 11 states. The company and its AEP affiliates employ approximately 1,200 people in West Virginia, making AEP one of the largest employers in the state. It is also one of the largest taxpayers in the state. AEP owns the nation\u2019s largest electricity transmission system, a more than 40,000-mile network that includes more 765-kilovolt extra-high voltage transmission lines than all other U.S. transmission systems combined. AEP also operates 224,000 miles of distribution lines.\u00a0 AEP ranks among the nation\u2019s largest generators of electricity, owning approximately 26,000 megawatts of generating capacity in the U.S. AEP supplies 3,200 megawatts of renewable energy to customers.