Thursday, February 04, 2010
Bill to suspend Appalachian Power rate increase clears first legislative hurdle
RICHMOND -- Legislation that would lead Appalachian Power Co. to suspend an interim rate charge it began collecting in December cleared its first hurdle this afternoon and appears to be on a fast track to passage in the General Assembly.
The House Commerce and Labor Committee swiftly approved a bill establishing a timeline for state regulators to rule on Appalachian’s pending rate increase request. The full House likely will vote on the bill (House Bill 1308) next week while the Senate takes up an identical measure (Senate Bill 680).
If the legislation passes and Gov. Bob McDonnell signs it, Appalachian would immediately suspend the 12.8 percent interim rate increase imposed in December. The legislation would require the Virginia State Corporation Commission to rule on Appalachian's base rate request by July 15 and for new rates to take effect Aug. 1.
The legislation represents a compromise by Appalachian, which has been under fire from customers and state legislators complaining about skyrocketing electric bills. Appalachian’s interim rate increase took effect at the same time severe winter weather set in, producing staggering increases in electric bills.
Several lawmakers filed bills that would limit Appalachian’s ability to increase rates. But Appalachian officials and some lawmakers warned that the compromise legislation would unravel if those bills are passed.
Appalachian estimated the typical residential customer who uses 1,000 kilowatt hours a month would see a decrease in the monthly bill from $117.86 to $105.81 while the suspension is in effect.
Appalachian had planned to collect the interim increase until the SCC decided to either approve the increase as requested or reduce it.
If the SCC approves a lesser increase than Appalachian wants, the company typically would be required to credit customers' bills for the difference plus interest. Under the legislation, however, any required refunds from the December increase would be offset by the amount of revenue the company would have collected if the SCC's approved rate had been in effect during the suspension period.
The House Commerce and Labor Committee swiftly approved a bill establishing a timeline for state regulators to rule on Appalachian’s pending rate increase request. The full House likely will vote on the bill (House Bill 1308) next week while the Senate takes up an identical measure (Senate Bill 680).
If the legislation passes and Gov. Bob McDonnell signs it, Appalachian would immediately suspend the 12.8 percent interim rate increase imposed in December. The legislation would require the Virginia State Corporation Commission to rule on Appalachian's base rate request by July 15 and for new rates to take effect Aug. 1.
The legislation represents a compromise by Appalachian, which has been under fire from customers and state legislators complaining about skyrocketing electric bills. Appalachian’s interim rate increase took effect at the same time severe winter weather set in, producing staggering increases in electric bills.
Several lawmakers filed bills that would limit Appalachian’s ability to increase rates. But Appalachian officials and some lawmakers warned that the compromise legislation would unravel if those bills are passed.
Appalachian estimated the typical residential customer who uses 1,000 kilowatt hours a month would see a decrease in the monthly bill from $117.86 to $105.81 while the suspension is in effect.
Appalachian had planned to collect the interim increase until the SCC decided to either approve the increase as requested or reduce it.
If the SCC approves a lesser increase than Appalachian wants, the company typically would be required to credit customers' bills for the difference plus interest. Under the legislation, however, any required refunds from the December increase would be offset by the amount of revenue the company would have collected if the SCC's approved rate had been in effect during the suspension period.
