Coal cost cited in rate hike request
by Kevin Kelly
9 months ago | 544 views | 0 0 comments | 3 3 recommendations | email to a friend | print
POINT PLEASANT — Appalachian Power’s request to increase customers’ electric rates by 43 percent over a 3-year period is based on increased expense for fuel — coal, that is.

Appalachian, a subsidiary of American Electric Power that serves Mason County and southern West Virginia, has projected the average cost of coal for its power plants to rise to between $65 and $70 a ton in the next year from a current level of about $45 a ton.

Almost all of the electricity in West Virginia comes from coal-fired power generating stations. The increase, totaling $442 million over the three years, will also cover Applachian’s cost for purchasing power as well.

“It’s not a matter of profit for the company, but catching up to cover the cost of fuel going forward,” said Phil Moye, Appalachian’s principal corporate communications manager.

He and Jeri Matheney, manager of corporate communications, have been in Mason County explaining reasons for the rate hike request to Appalachian employees and customers. They spoke Thursday to employees at the company’s Point Pleasant service center, and have already met with staff at the two local power plants, Sporn and Mountaineer.

Appalachian filed its request with the West Virginia Public Service Commission on March 6. PSC has scheduled hearings for June and expects to make a ruling by late September.

An increase of 18.5 percent on customers’ bills, translating into an estimated $189 million, is projected for the first year if the PSC approves the request.

“If you break it down to something meaningful to customers, the average customer pays about $2.38 per day for electricity,” Moye said. “The impact of that 18.5 percent increase would be another 38 cents, bringing their average daily cost to $2.76.

“But when you power your lights, refrigerator, stove, TV and other appliances, it’s still a good value,” he added.

Matheney said a “very small amount” of the rate hike is going to fund clean coal technology efforts at the Mountaineer and John Amos plants.

“We agree it’s massive,” Matheney said of the request. “It’s a reflection of the coal industry in the past year and what we expect in the next.”

Matheney stressed that customers have the ability to cut their bills through conservation methods, such as unplugging appliances not in use. Even when plugged in but not being operated, appliances still use power. That in itself spells $3 to $4 off a bill, she added.

Information on conservation methods is available at www.appalachianpower.com or www.wattandwhy.com.

Appalachian’s presence in Mason County is significant, with employees at the service center, the power plants and at AEP River Transportation.

“Per capita, Mason County has more AEP or Appalachian employees here than in any other part of the state,” Moye said.
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