MORGANTOWN, W.Va. — If approved by the state Public Service Commission, Mon Power customers could see a rate increase beginning in January.
According to Todd Meyers, spokesperson for parent company First Energy, the annual request for 2016 rates is up 8 percent.
“For our residential customers, if our request is approved, that would be about an $8.79 increase to the bills come January first,” Meyers estimated.
A number of economic factors play into the requested rate, Meyers said.
For example, if First Energy underestimates the cost of acquiring energy from power plants to distribute to customers, the company will request a rate increase by each September to make up the difference in the following year.
“It’s something we do year in and year out. It’s the rates that have to do with the purchase power and the fuel rates on the electric side of the fence,” according to Meyers.
A recent nuance added to the bottom line First Energy is trying to recoup.
Effective October 2013, Mon Power purchased the remaining 80 percent of the Harrison County power plant not already owned by the First Energy subsidiary.
“For about a 17-month period, there was a special surcharge. That surcharge was designed to collect enough money for the ownership and operation of the plant. But, it did under-collect to the tune of about $44 million,” Meyers calculated.
According to Meyers, representatives with the state PSC and First Energy knew the company didn’t have access to enough power to keep up with customer demand and the buyout was necessary.
The Aug. 14 First Energy request to the PSC reflects $121 million for under recovery in fuel costs and purchasing power along with the 44 million dollar reconciliation of the surcharge from the purchase of a Harrison County plant.
A PSC decision is not expected until the end of the year.