By: Jarrod Clay | Posted: May 9, 2018 | Source: WCHSTV
CHARLESTON, W.Va. (WCHS/WVAH) — Appalachian Power and Wheeling Power have filed a request with the Public Service Commission of West Virginia for a $114.6 million revenue increase.
If passed, the request would raise rates in West Virginia by 7.85 percent, according to a news release from Appalachian Power.
The release said residential customers would see a 11.1 percent rate increase, which would be about $14.81 for the average monthly bill. Commercial customers’ rates would increase by 11.5 percent, which would be about $42.43. Industrial rates would increase by 1.1 percent, which would equate to about $1,960.
“Today we submitted a request to the commission in which we present our costs of providing safe and reliable electric service to our customers,” Chris Beam, Appalachian Power president and chief operating officer said in the release. “It 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.”
The release said the company is proposing changes to its rate structure to help reduce high winter electric heating bills and seasonal bill volatility for residential customers.
According to the release, about half of the requested increase is due to a significant decline is the amount of electricity used by customers. Appalachian said customer usage has been declining for several years and has dropped by 14 percent since 2013. The number of residential customers also has dropped by about 11,000 since 2013.
Appalachian Power said major improvements to infrastructure is also driving the need for increased rates. The release said these improvements include generation facilities, the transmission system serving the region, and distribution facilities, including upgrades to the underground distribution networks in Huntington.
“We continue to invest in our transmission and distribution network to ensure that service remains reliable,” Beam said in the release. “Our goal is to balance our customers’ service expectations with the need to keep prices as low as possible.”
Appalachian Power said the recent Tax Cuts and Jobs Act of 2017 reduced the company’s request by about $52 million.
The release said 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.
The rate hike request also includes a 10.22 percent authorized return on equity. The release said earning a fair return on equity is critical to the company’s ability to do business.
Appalachian Power requested that the rate increase go into effect on June 8, 2018, but new rates would not go into effect until they are approved by the Public Service Commission, which can take up to 300 days to make its decision.
