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Tuesday, February 16, 2010

Executives tell governor that high power rates may move jobs

House Minority Leader Ward Armstrong tries unsuccessfully to revive bill for tighter regulation of utility costs.

Soon after the meeting with Gov. McDonnell, the subject of Appalachian’s rate increases heatedly re-emerged in the House of Delegates. Del. Ward Armstrong, D-Henry County, (pictured) tried unsuccessfully to revive a bill he had introduced that could have restricted Appalachian’s ability to raise rates. His bill died in committee last week.

Associated Press

Soon after the meeting with Gov. McDonnell, the subject of Appalachian’s rate increases heatedly re-emerged in the House of Delegates. Del. Ward Armstrong, D-Henry County, (pictured) tried unsuccessfully to revive a bill he had introduced that could have restricted Appalachian’s ability to raise rates. His bill died in committee last week.

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Words like “gouging” and phrases like “beyond the pale” peppered a meeting this morning in Richmond as several regional manufacturing executives and other businesspeople expressed to Gov. Bob McDonnell their fears about the effects of ongoing rate hikes by Appalachian Power Co.

That’s according to participant Doug Bassett, chief operating officer for Vaughan-Bassett Furniture in Galax. He helped organize the one-hour meeting with McDonnell.

Bassett said afterward that the governor was “an engaged questioner and listener” who made no promises beyond pledging additional inquiry into the companies’ concerns. He said the governor reiterated his focus on job creation and retention.

Several state legislators attended the meeting too.

And soon after its conclusion the subject of Appalachian’s rate increases heatedly re-emerged in the House of Delegates. Del. Ward Armstrong, D-Henry County, tried unsuccessfully to revive a bill he had introduced that could have restricted Appalachian’s ability to raise rates. His bill died in committee last week.

Bassett said that during the discussion with McDonnell he and other manufacturing executives told the governor that rising electric rates and bills from Appalachian might someday lead them to shift resources to more efficient facilities in places with lower electric rates.

“It was more an implication than a threat,” he said.

Appalachian officials have repeatedly said that state law provides the utility, as a regulated monopoly, opportunities to recover reasonable costs of doing business as well as a profit deemed fair. They have said their costs continue to rise, in part because of compliance with environmental regulations. Appalachian and its parent company, American Electric Power, rely heavily on coal-fired plants to generate power.

Appalachian’s rate hikes, combined with prolonged spells of cold weather this winter, have recently  hit businesses and residential customers with high electric bills – which is one reason the utility has been on a hot seat during this session of the General Assembly.

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