Appalachian Power Company

11/01/2024 | Press release | Distributed by Public on 11/01/2024 13:31

Appalachian Power proposes solutions and resources to benefit customers in latest rate review application

Appalachian Power proposes solutions and resources to benefit customers in latest rate review application

November 1, 2024

CHARLESTON, W.Va., Nov. 1, 2024 - Appalachian Power, along with Wheeling Power, today refiled a base rate review application with the Public Service Commission of West Virginia (PSC) for its non-fuel base rates. In the filing, the companies included two proposals to lessen the impact on customers and provide long-term rate stability.

Under traditional recovery methods, the companies have requested to increase annual revenues by approximately $250.5 million, or 14.12 percent. A residential customer using 1,000 kilowatt-hours (kWh) a month would see a net increase in their monthly bill of approximately 13.54%, or $23.74.

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 kWh. The companies also proposed a new Electricity Rate Stabilization (ERS) mechanism to provide stability in future rate cases and limit the frequency of rate adjustments.

If accepted by the PSC, securitization will 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.

"Without leveraging the 2023 securitization legislation, traditional recovery of our investments would add to the burden some of our customers already face due to rising inflation and costs across many industries," said Aaron Walker, Appalachian Power president & chief operating officer. "We are requesting the PSC approve our securitization proposal and the ERS to lessen both near-term and long-term rate impacts."

Since the companies' last base rate increase more than five years ago, investments of $1.3 billion were made to upgrade and modernize the grid. "The reliability improvements we've made - and will continue to make - allow us to restore power more quickly and efficiently following major storms, such as Hurricane Helene," Walker said.

Appalachian Power and Wheeling Power have approximately 460,000 customers in parts of 25 counties of West Virginia.

Without securitization, the average monthly bill for the various classes of customers would be changed as follows under the proposed rates:

Class

$ Increase

% Increase

Residential

$27.15

16.16%

Commercial

$57.09

14.04%

Industrial

$32,385.00

11.63%

Resale

N/A

N/A

Other

$1.33

12.01%

The companies are requesting rates be effective December 1, 2024. The PSC generally suspends such requests, and any increase to the companies' rates will not be put into effect until approved by the PSC, which can take up to 300 days to render a decision. Anyone desiring to intervene or file a written protest should contact the West Virginia Public Service Commission at P.O. Box 812, Charleston, WV 25323.

For more information on the companies' proposals and resources available for customers impacted by rising energy costs, visit AppalchianPower.com/WVRateReview.

Appalachian Power has 1.1 million customers in Virginia, West Virginia and Tennessee (as AEP Appalachian Power). It is part of American Electric Power, which is focused on building a smarter energy infrastructure and delivering new technologies and custom energy solutions. AEP's approximately 16,000 employees operate and maintain the nation's largest electricity transmission system and more than 225,000 miles of distribution lines to efficiently deliver safe, reliable power to nearly 5.6 million customers in 11 states. AEP is also one of the nation's largest electricity producers with approximately 29,000 megawatts of diverse generating capacity.