SCC Sets September Hearing On APCo Rate Increase

By David McGee
Staff Writer / Bristol Herald Courier
Published: July 23, 2008

The Virginia State Corporation Commission on Tuesday set a September hearing date for Appalachian Power’s request for a fuel factor increase.

The commission will consider Appalachian’s latest request at 10 a.m. on Sept. 23, according to an SCC news release. Under the plan, the fuel factor would increase 11.7 percent for average residential customers and more than 13 percent for heavy power users.

The commission also granted the company’s request to implement the increase on an interim basis beginning on Sept. 1.

Appalachian sought the increase last week, blaming the rising price of coal used to fire its generators and weakness of the U.S. dollar in international markets.

If approved, the average residential customer who uses 1,000 kilowatt-hours per month would pay an additional $11.71.

Fuel factor increases typically go into effect on Jan. 1, but Appalachian sought the increase earlier because the price of coal used to generate electricity more than doubled in the first half of 2008, a company official said last week.

If approved, the latest increase could combine with two other increase requests, which could cause electric rates to rise by nearly 40 percent by the beginning of 2009.

The two other requests were for a 24 percent increase for the base rate Appalachian charges all power customers, and a 2 percent environmental and reliability cost increase to cover the cost of emissions reduction equipment at its power plants.

The base rate request, which would raise monthly residential bills between $17 and $25, has already generated opposition, according to the SCC Web site. More than 1,000 customers have written letters or sent e-mails opposing the proposed base rate increase.

The company received a similar interim 25 percent increase in 2006, but after receiving more than 20,000 opposition letters, e-mails and phone calls, the commission rolled back the increase to 3.1 percent.

The 24 percent increase will go into effect on an interim basis on Oct. 28 and a public hearing is set for 10 a.m. the following day at the commission’s Richmond office.

Appalachian provides electricity to about 500,000 customers in Southwest Virginia.

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