CHARLESTON, W.Va. — Appalachian Power is seeking an agreement with the Public Service Commission of West Virginia regarding the utility’s savings from the federal tax law.
The utility company filed a settlement agreement Monday proposing using funds related to the Tax Cuts and Jobs Act to offset $110 million in fuel and vegetation management costs. The proposal also includes keeping rates stable through June 2020.
“It’ll keep the fuel and purchase power and the vegetation management portion or rates flat until mid-2020,” Appalachian Power communications director Jeri Matheney said. “It’s possible that rates could have gone up by as much as 11 percent for residential customers due to the increase in the cost of fuel.”
PSC staff, the Consumer Advocate Division, the West Virginia Energy Users Group and the Steel of West Virginia approved the deal, stating it would minimize the impact on customers.
Appalachian Power Company previously filed a rate increase proposal that would result in an average rate increase of 11 percent. The company also told the commission it was saving $235 million because of the new tax bill. The utility told the commission at a hearing last month it planned to set aside $131 million for fuel and vegetation purposes.
The original proposal remains open.
Kanawha County Commission President Kent Carper, a vocal opponent of the proposed rate increases, warned the commission about latest action.
“The bottom line is this: Appalachian Power Company took our money to pay federal taxes, taxes that the company no longer has to pay. While the proposed settlement does stop some future rate increases, it does not in my opinion go far enough,” he said in a release.
Carper and the Kanawha County Commission have led a local effort, the Kanawha County and Cities Association, an ad hoc organization uniting governments to oppose rate increases.