June 6, 2009
PSC Denies AEP Interim Rate Increase Due to Unnecessary Hardships
By Tony Rutherford
Huntingtonnews.net Reporter
Charleston, WV (HNN) – The West Virginia Public Service Commission on June 4 denied an interim rate increase for Appalachian Electric Power. The requested interim increase would have been the largest in state history.
The utility has asked for a $442 million dollar increase, or about 43.3%. AEP asked the Commission to consider a three- phase increase over a three-year period. They requested that the interim rates be approximately 38% of the request. AEP reminded the commission the money collected would be subject to refund, if later disallowed.
“Our state and nation are experiencing extraordinarily difficult economic circumstances. Due process considerations prevent the commission from granting AEP’s interim rate increase…granting AEP’s request without the benefit of a preliminary audit and Commission review of that audit and results could produce unnecessary hardships and significant adverse financial effects on customers even if the commission approves interim rates, but ultimately decides that AEP has not prevailed in its case.”
The PSC has suspended use of the proposed rates until December 5, 2009 and will attempt to issue a final order by September 30, 2009.
One reason for AEP’s “under recovery” came from the shut down of Century Aluminum’s Ravenswood facility. Under the AEP plan, residential customers could be adversely impacted should more large customers shut down.
Steel of West Virginia has objected to the increase asserting that deferring the increased charges would be “preferable” as the economy could “begin improving.” Further, Steel of West Virginia argued that if the interim rates were approved, neither intervenors nor the Commission would have “sufficient opportunity to examine the interim rates before they take effect.”
Others objecting to the interim rates were the West Virginia Energy Users, Alcan Rolled Products, West Virginia Citizens Action Group and Century Aluminum and Staff.
AEP did not claim “financial distress” as the basis for the increase.
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PSC Denies AEP Interim Rate Increase Due to Unnecessary Hardships
By Tony Rutherford
Huntingtonnews.net Reporter
Charleston, WV (HNN) – The West Virginia Public Service Commission on June 4 denied an interim rate increase for Appalachian Electric Power. The requested interim increase would have been the largest in state history.
The utility has asked for a $442 million dollar increase, or about 43.3%. AEP asked the Commission to consider a three- phase increase over a three-year period. They requested that the interim rates be approximately 38% of the request. AEP reminded the commission the money collected would be subject to refund, if later disallowed.
“Our state and nation are experiencing extraordinarily difficult economic circumstances. Due process considerations prevent the commission from granting AEP’s interim rate increase…granting AEP’s request without the benefit of a preliminary audit and Commission review of that audit and results could produce unnecessary hardships and significant adverse financial effects on customers even if the commission approves interim rates, but ultimately decides that AEP has not prevailed in its case.”
The PSC has suspended use of the proposed rates until December 5, 2009 and will attempt to issue a final order by September 30, 2009.
One reason for AEP’s “under recovery” came from the shut down of Century Aluminum’s Ravenswood facility. Under the AEP plan, residential customers could be adversely impacted should more large customers shut down.
Steel of West Virginia has objected to the increase asserting that deferring the increased charges would be “preferable” as the economy could “begin improving.” Further, Steel of West Virginia argued that if the interim rates were approved, neither intervenors nor the Commission would have “sufficient opportunity to examine the interim rates before they take effect.”
Others objecting to the interim rates were the West Virginia Energy Users, Alcan Rolled Products, West Virginia Citizens Action Group and Century Aluminum and Staff.
AEP did not claim “financial distress” as the basis for the increase.
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