By Brad McElhinny
West Virginia Metro News
Some West Virginia residents have already started to formally protest a rate increase of $250 million a year proposed by power companies serving the state.
“Please do not let them increase rates,” Cabell County resident Steven Wayne Albright wrote in a comment to the West Virginia Public Service Commission.
South Charleston resident Greg Zornes wrote to the PSC, “I strongly oppose Appalachian Power’s request to once again raise rates on customers. I am so tired of trying to live within my family budget when our utility providers are not expected to do so.”
He concluded by pleading to utility regulators, “Stop the insanity.”
Those are among several comments already submitted for a rate case that was revived at the start of November.
Potentially affected are 460,927 customers in Boone, Brooke, Cabell, Clay, Fayette, Greenbrier, Jackson, Kanawha, Lincoln, Logan, Marshall, McDowell, Mercer, Mingo, Monroe, Nicholas, Ohio, Putnam, Raleigh, Roane, Summers, Wayne, Wetzel and Wyoming counties.
In September, the PSC rejected a $265 million rate increase request by Appalachian Power and Wheeling Power, mostly because the application had big gaps of missing financial information. That decision acknowledged the filing could be resubmitted in a more complete form as soon as the companies got prepared, so that’s what is on the table now.
The request by Appalachian Power, along with Wheeling Power, would increase electricity costs for customers, although the power companies submitted two rate structures for the PSC to consider, suggesting options could soften the blow.
Under traditional recovery methods, the companies have requested to increase annual revenues by about $250.5 million, or 14.12 percent. A residential customer using 1,000 kilowatt-hours a month would see a net increase in their monthly bill of about 13.54%, or $23.74, the power companies said.
As an alternative, the companies propose using securitization to mitigate the impact of their request, resulting in an overall monthly bill increase of approximately 3.8%, or $6.72, for a residential customer using 1,000 kilowatt hours. The companies also proposed a new Electricity Rate Stabilization mechanism characterized as providing stability in future rate cases and limiting the frequency of rate adjustments.
The power companies say that if the securitization option is accepted by the PSC, that would reduce the impact on customers by 70%, with an increase of approximately $75 million, and the ERS would stabilize future base rates within 3% annually.
Securitization means pooling assets and selling them as tradeable securities to investors. Essentially, the utilities are asking to take out consumer rate relief bonds. The securitization is possible because of a bill passed by the state Legislature, House Bill 3308.
Appalachian Power has been working to communicate with customers who might be affected. Aaron Walker, president and chief operating officer of Appalachian Power, distributed a written op-ed earlier this month, starting by saying the company has invested more than $1 billion since our last rate review five years ago to make electric service more reliable.
“While we will continue to find ways to meet current and future energy needs, customers have made it abundantly clear that rising energy costs have put many under financial strain,” Walker wrote. “We hear you.
“At the same time, we need to continue making improvements to keep the lights on and ensure that West Virginia has the energy we need to grow our communities.”
His written piece outlined the two proposals that the power company has put before the PSC.
“I understand that it’s never a good time to request a rate increase, and again, we’re here to help with that as well,” Walker wrote, describing some programs that can help provide a break for people struggling with costs.
The Public Service Commission has begun the first steps of lining up the case for review.
Last week, the commission submitted an order noting that West Virginia Energy Users Group, Solar Holler, SWVA Inc. (which owns a steel production facility in Huntington), West Virginia Citizens Action Group, Solar United Neighbors and Energy Efficient West Virginia had filed petitions to intervene — as had the consumer advocate division of the PSC. The order approved their requests.
The PSC order then officially designated Appalachian Power and Wheeling Power as respondents. The parties that are now officially involved in the case are supposed to work together to offer a proposed schedule to consider the factors in the request.
And it required public notice to let citizens know more about the financial effects of the request.
Some citizens are already letting the PSC know how they feel.
“With everything that is going on these days, the cost of living is increasingly hard to manage,” wrote customer Sherry Hamilton. “Please reconsider and deny any rate increases.”
Another customer, Joanne Partin emphasized the role of the PSC to represent the public’s interest: “I am asking that the PUBLIC Service Commission not approve this huge, outrageous increase on West Virginians.
“I am asking the PUBLIC Service Commission to advocate for West Virginians!”
Fayetteville resident Georgia Fuller headlined a letter with a single, underlined word in all caps: “GREEDY!