Appalachian Power, Wheeling Power request rate increase to cover infrastructure costs

The companies have proposed increasing rates to cover infrastructure investments by $10 million for over 462,000 customers across 25 West Virginia counties.

The request comes a month after the PSC denied the companies’ request for a $297 million increase in annual fuel cost recovery until its staff finishes a review that began in May 2022 to determine whether the companies’ policies for maintaining adequate fuel inventory levels are prudent.

If approved, that request would raise the monthly bill for a residential customer using 1,000 kilowatt-hours by $18.41.

The average monthly bill would increase by $2.31 (0.55%) for commercial customers and $1,161.04 (0.47%) for industrial customers.

The commission approved the annual tracker mechanism for infrastructure investments made between base rate cases in 2021.

State ratepayers faced a 90% rise in average residential electricity retail price from 2005 to 2020, according to Energy Information Administration data. Only Michigan had a greater increase by percentage.

The average monthly residential bill covering 1,000 kilowatt-hours for AEP’s West Virginia utilities escalated from $55.28 in 2006 to $138.57 in 2021 — an increase of 150% over 15 years.

Since the start of 2017, Appalachian Power has received 14 rate increases raising the average monthly residential rate from $128.09 effective March 2019 to the current rate of $162.43, spokesperson Phil Moye said Thursday. Over half of that $34.34 increase has consisted of fuel cost recovery — $18.70.

Another 19%, or $6.43, went toward infrastructure investments, which Moye noted has included distribution automation equipment aimed at improving service reliability. An additional 18%, or $6.14, has covered increases in right-of-way clearing costs for the company’s cycle-based vegetation management program, in which vegetation is cleared along distribution circuits every four years.

West Virginia finished dead last in reliability and overall performance in a ranking of electric utility performance among all states released last year by the Citizens Utility Board, an Illinois consumer advocate group.

Appalachian Power’s West Virginia coverage area ranked in the highest 3% of all 958 listed utilities nationwide in outage minutes per year and outage minutes per interruption, as well as the highest 9% in non-momentary electric interruption frequency in 2021, according to Energy Information Administration data.

Appalachian Power failed to meet a minimum target approved by the state Public Service Commission for the average minutes it takes to restore non-momentary electric interruptions in 2021, according to a report it filed last year with the commission.

Equipment failure was responsible for more than 4,100 sustained interruptions in 2021, the second-most common cause behind only trees outside rights-of-way (over 4,700).