The Franklin News-Post|
P. O. Box 250
310 Main Street, SW
Rocky Mount, Virginia 24151
Friday, February 5, 2010
By JOEL TURNER - Staff Writer
Appalachian Power Co. (APCo) would suspend an interim rate increase that it began charging in December if the General Assembly and Gov. Bob McDonnell approve emergency legislation that sets a timetable for the State Corporation Commission (SCC) to rule on APCo's request for a rate increase.
APCo and state legislators said Wednesday that they are working on a plan to suspend the interim rate increase until the SCC rules on APCo's request for a permanent rate increase.
APCo would suspend the 12.8-percent interim rate increase when McDonnell signs the emergency legislation after it has been approved by the General Assembly.
Under the proposed schedule worked out by state legislators, McDonnell could sign the legislation by the middle of February.
The legislation would require the SCC to rule on APCo's rate increase request by July 15.
Depending on the SCC's ruling, the new rates would take effect Aug. 1
APCo had intended to collect the interim rate increase until the SCC approved, denied or reduced it.
The emergency legislation will considered by the House Commerce and Labor Committee this week. The Senate Commerce and Labor Committee will take up the legislation on Monday (Feb. 8).
If the SCC approves a smaller permanent increase than APCo has requested, APCo will credit a customer's bill for the difference plus interest from Dec. 12 when the interim rate increase was first imposed.
Under the proposed legislation, however, any refunds from the December increase would be offset by the amount of revenue that APCo would have collected if the SCC's approved rate had been in effect during the suspension period.
The interim rate increase will be suspended on the first bills after the legislation is signed.
The plan to suspend the interim rate increase has come in response to consumer complaints about rising electric bills.
State legislators have responded to the complaints and anger by their constituents over higher electric bills by filing at least nine bills in the General Assembly that would limit APCo's right to raise rates.
Franklin County's representatives in the legislature,
State Sen. Robert Hurt (R-Chatham) and Del. Charles Poindexter (R-Franklin County), said they have received dozens of complaints from constituents who are upset about their electric bills.
Hurt said he believes that state legislators have an obligation to do what they can to help constituents who are facing large increases in their bills. He is a co-sponsor of several of the APCo-related bills that have been introduced in the General Assembly.
One bill would prohibit APCo from imposing an interim or temporary rate increase unless it has been approved by the State Corporation Commission (SCC). Hurt is a co-sponsor of this bill.
Poindexter has joined in co-sponsoring a proposal for a study that would "determine if it would be in the best interests of the Commonwealth if Appalachian Power were to be replaced by another entity."
APCo has said that the large increases in December and early January were caused primarily by the long period of cold temperatures and increased consumption of power -- not the rate increase.
At an earlier public hearing in Rocky Mount on APCo's latest rate increase, Poindexter said the economy is unlikely to improve during the next two years, and consumers will struggle to pay their electric bills.
"Businesses are only hanging on and cannot absorb higher costs," Poindexter said. "Elderly people on fixed incomes are especially facing costs they cannot cover. Unemployed and underemployed people simply lack the funds to pay increased rates."
Local governments and school divisions also have rising costs which limit their financial ability to pay higher electrical rates, Poindexter said.
APCo officials said the rate increases are needed to recover their costs and provide a fair rate of return when environmental regulations are increasing costs.
APCo executives have said that the company is taking steps to help customers who are having trouble paying their bills.