Appalachian power proposal could increase customer rates

West Virginia
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CHARLESTON, WV (WOWK) – Appalachian Power and Wheeling Power have submitted a proposal to the Public Service Commission of West Virginia they say is to implement a surcharge mechanism to recover costs associated with infrastructure investments made between base rate cases.

According to Appalachian Power, the initial filing seeks an increase of $49.8 million. If approved, residential customer rates would rise about 3.5% beginning June 1, 2021, the company says. Customers using 1,000 kilowatt-hours would receive a $4.94 monthly increase and customers using 2,000 kilowatt-hours would receive a $8.86 monthly increase.

The company says the $49.8 million represents recovery costs associated with infrastructure investments made over a nearly three-year period. According to Appalachian Power, the proposal aims to recover those costs not recovered through current rates. They also say the proposal should decrease maginitude and frequency of base rate case filings.

Appalachian Power says the recovery mechanism, or infrastructure tracker, is similar to the mechanisms alrady used for other regulated utilities.

“The infrastructure tracker is designed to smooth out customer rates by seeking capital investment recovery annually,” said Chris Beam, Appalachian Power president and COO. “For customers, that helps us avoid the large jumps in rates that can happen when costs build up over time.”

According to the company, the proposal calls for capping any annual increase through the tracker to a percent of the companies’ total revenue. This subjects the tracker to an annual true up for either over or under recovery as well as resetting the mechanism to zero when new rates become effective after a new base rate filing.

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