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Business & Technology

AEP seeking rate hike in Kingsport

June 8th, 2012 10:46 pm by Kevin Castle

KINGSPORT — Appalachian Power officials are filing for a second rate increase on Kingsport power bills in the past eight months to help recoup costs from winter storm repair work done in 2009.

In a company press release issued Friday afternoon, American Electric Power officials said they had filed a request with the Tennessee Regulatory Authority for a surcharge increase that amounts to $1.59 per month on a customer’s monthly statement. Appalachian Power is a unit of AEP.

In November, the TRA entertained an AEP petition for a 1.5 percent increase for generation costs, or $1.24 per month per customer.

“The charge is expected to be in effect for about one year,” said Friday’s release. “Even with the proposed charge, Kingsport power rates remain among the lowest in the U.S.”

The company says over $1.6 million was expended in material and manpower costs to restore electricity to a good portion of the 47,000 customer on the Kingsport power grid following the December 2009 snow event.

“Back in 2010, we had asked (the TRA) to defer those costs and address them at a later date,” AEP Corporate Communications Manager Todd Burns told the Times-News. “We had some other increases that were taking effect during that period, and at this time it is kind of the right time to not let those costs continue to linger and (we) needed to move ahead and move (those costs) into rates.

“We faced an extraordinary situation (in 2009 in Kingsport), and the way rates are designed, rates are set at a level to recoup our day-to-day cost of operating the business and experience storms within reason. The storm we experienced in 2009 was the worst we had ever seen.”

The release called the work AEP crews did in 2009 “its greatest service restoration effort in its 84-year history” when over half of that 47,000-customer base lost power.

The surcharge increase will differ based upon customer class, according to the company, and the $1.59 proposed increase would be for customers who use about 1,000 kilowatt-hours a month.

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