The Cost of Coal Before PSC

The West Virginia Public Service Commission has set aside Monday and Tuesday to hear from Appalachian Power Company when it comes to what the utility is paying for coal to produce electricity.

The company can each year ask to be reimbursed for the cost of purchasing coal but Appalachian Power did not seek an increase in rates when it made this year’s fuel case filing back in March. That’s because the company is preparing another case where it will ask the PSC to allow it to sell bonds to help it pay off an estimated $300 million coal cost debt that’s been building for the past few years.

The hearing, which begins Monday morning at 9:30 at the PSC offices in Charleston, will focus on the fuel costs for the past year and projections for the years to come.

Appalachian Power says it’s preparing its case to securitize the debt through bonds. The state legislature passed a bill in March to give the utility the option.

Appalachian Power said at the time that without a way to spread the debt costs out over several years rates would have increased by as much 40 percent, possibly more.

To pay back the bonds, the company plans to use money from regular rates.


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