CHARLESTON, W.Va. — The state Public Service Commission approved a 9-percent overall rate increase Tuesday for Appalachian Power Company and Wheeling Power Company, though residential customers will pay 16 percent more.
The hike is expected to generate an additional $123 million annually.
The order spells out different percentages of increases, with typical residential customers expected to see an increase of $19.50 to their monthly bill. State Consumer Advocate Jackie Roberts called the rate hike too steep.
“Our position was that after evaluating the filing, we thought the appropriate level of expenses for the company would result in a base rate increase of 3.49 percent,” Roberts said.
AEP communications director Jeri Matheney maintained that even with the increase residential customers would still be paying below the national average.
“We requested this increase about a year ago and it’s finally come to fruition,” Matheney said. “We need it mainly to improve our infrastructure. We’ve got a lot of aging infrastructure out there—the lines, the towers. And we need to invest in that to insure that electricity stays reliable and improves.”
After the PSC ordered a one-year phase-in of the residential rate increases, Matheney said the utilities were “glad that the PSC had recognized some of the increasing costs of doing business.”
Roberts felt further evaluation was needed of the long report, but initially the increase seemed excessive.
“We need to evaluate the order and analyze the issues addressed by the commission,” she said. “But on a first blush, this seems to be a very high increase for residential customers.”
Appalachian Power and the smaller Wheeling Power received approval to increase their base rates and approval for a surcharge to pay for a new vegetation clearing program. The PSC said the base rate increase is tied to a $407-million investment by Appalachian Power to bring its power plants into compliance with federal environmental regulations. The new vegetation program was ordered by the PSC in response to the 2012 derecho and Superstorm Sandy that happened later that year.