PSC seeking public comment on AEP rate increase

By Peggy Mackenzie

The West Virginia Public Service Commission (PSC) has scheduled 10 public hearings regarding a pending Appalachian Power and Wheeling Power rate increase, first announced in June of this year. Both are subsidiaries of American Electric Power which has requested a $226 million, or approximately 17 percent, increase of rates and charges for their West Virginia customers and a revision of its depreciation rates.

The public hearings began last week in Bradshaw and Mercer counties. Other hearings will be held this month in Huntington and Wheeling and in January at the PSC office in Charleston.

Homeowners and individual customers could get higher rate increases than industrial and commercial consumers under the proposal Appalachian Power submitted in June. For example, residential customers using 1,000 kilowatt-hours a month would see their monthly power bills rise by 23.2 percent, or $21.77; to $115.77 from $94, according to a statement from the power company.

According to a news release, the increased revenues are needed to cover the costs of doing business. Day-to-day costs of an electric utility are recovered in “base rates.” Base rates have not increased for Appalachian Power customers in West Virginia since 2011.

“It includes things like storm restoration costs from the derecho [June 29, 2012] and Superstorm Sandy [Oct. 29, 2012], implementation of a right-of-way maintenance program to improve reliability, and a return that is sufficient to attract capital,” said Charles Patton, president of Appalachian Power.

The PSC required all power companies in the state to submit a plan to keep rights of way clear after downed trees from events like the derecho and Sandy kept some customers without power for weeks. Of the more than $226 million the AEP estimates the increase would raise, more than $44 million will go to the right-of-way maintenance program.

In March, the PSC noted that the right-of-way maintenance plan would cost customers, “but doing nothing, in our opinion, costs even more,” stated Jacqueline Lake Roberts, director of the PSC’s Consumer Advocate Division. She said her division would examine the request and see if it was justified.

PSC regulators have set an evidentiary hearing in the case for January, 2015.

AEP serves approximately 476,600 customers in Boone, Cabell, Clay, Fayette, Greenbrier, Jackson, Kanawha, Lincoln, Logan, Marshall, Mason, McDowell, Mercer, Mingo, Monroe, Nicholas, Ohio, Putnam, Raleigh, Roane, Summers, Wayne, and Wyoming counties. AEP is one of the nation’s largest producers of electricity.

 

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