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Business & Technology

SCC approves rate hike for Appalachian Power in Va.

October 21st, 2008 12:00 am by Kevin Castle



Appalachian Power, which serves portions of Virginia including Scott County, will be allowed to adjust its rates to help the company recoup costs from environmental and power generations tasks.


The State Corporation Commission entered the decisions last week, including lowering the interim fuel rate the company used to recover funds spent to purchase fuels that generate electricity.


According to a commission news release, an average residential customer who uses 1,200 kilowatts of electricity per month could save $1.14.


“That is a pass-through, basically,” Appalachian Power spokesman Todd Burns said Tuesday. “We buy coal to generate electricity, and we pass the costs along to the customer.”


The SCC said it recognizes that the cost of coal has gone up significantly since the nation’s energy dependence problems began influencing companies and markets earlier this year, thus it acting accordingly by justifying the rate.


Appalachian Power stated in a previous news release issued this summer that coal it purchases from the central and northern Appalachia regions has increased by 133 percent in price in a year’s time.


Burns said the other rate adjustment, which will have less than a 2 percent impact on residential power rates, will allow the power company to recover “large environmental expenses” for costs it encountered beginning in October 2006.


Under stipulations agreed upon by all parties involved in the rate hearing, Appalachian Power will net a surcharge increase of $11.7 million, nearly $6 million less than the company sought.


But the hearing that could have major implications on power customers on Appalachian’s power grid is the one scheduled for Oct. 29 in Richmond.


That is when the SCC will consider the company’s request for a 24 percent increase in base power rates.


SCC spokesman Andy Farmer told the Roanoke Times last week that over 17,000 letters and e-mails have been received by the agency regarding the subject, and most are concerned citizens worried about what a higher electric bill could do to already strained household budgets.


Individuals have until close of business today to make public comment about the case. Those who want to send an e-mail regarding the Appalachian Power rate increase can visit the SCC’s Web site: www.scc.virginia.gov/case/PublicComments.aspx.



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