Efforts to change the way Virginia regulates electricity rates hit a road block tonight in a General Assembly committee. The panel refused to endorse legislation proposed by Martinsville Delegate Ward Armstrong and Henry Co. Senator Roscoe Reynolds.
"People I represent are getting whipsawed," Reynolds told members of the Virginia Commission on Electric Utility Regulation. "They’re getting whipsawed between what they’re paying for gasoline and what they’re paying for electricity," Reynolds said.
Reynolds and Armstrong pressed their case Thursday night, arguing that Virginia’s system for regulating electric rates is flawed and that Virginians are paying more for power they should. "We’ve done the citizens a disservice if we allow that to happen," Armstrong told the committee.
They want to return to the regulatory system that was in place before 1999, but Appalachian Power says its rates reflect the cost of coal and environmental controls, not the current law. "Nor do we believe that repealing this law as has been proposed by some would lower rates," said Appalachian Power Company representative Joe Jones.
Members of the committee agreed, saying the legislation might jeopardize a power company’s ability to meet growing demand. "I’ve got to look out for my people and I don’t see where going back to the old way is a plus," said Fairfax Senator Dick Saslaw.
"We think the 2007 legislation has some good qualities to benefit customers as well as the company," Appalachian Power spokesman Todd Burns told News 7. "And we hope going forward we’ll be able to continue to use that to the benefit of both the customers and the company."
Armstrong said he wasn’t surprised by the committee’s decision. "We have to work harder, I guess, to try and convince them that this regulatory scheme needs to be changed," Armstrong said after the hearing.
The debate doesn’t end there. The legislation's prospects might not have improved in the last year, but Armstrong and Reynolds will be back before another committee next week.
The weather is warmer than it was a year ago, and customers of Appalachian Power are paying less for the electricity they consume, but concern over high power bills continues to fuel concern in Richmond. The debate over electric rates is about to heat up again in the General Assembly.
This year both sides say something’s different. "The rates are down so customers are indeed seeing a lower rate this January than they had last January," says Appalachian Power Co. Spokesman Todd Burns. "That’s helped."
While Appalachian Power touts lower rates and warmer temperatures, Martinsville Delegate Ward Armstrong points to the study his electricity utility work group completed during the break between General Assembly sessions. "I was fairly certain of what the problems were and what the fix was," Armstrong told News 7. "I’m absolutely certain of what those problems are and what the fix is."
Armstrong believes his case is stronger than ever that Virginia should roll back its regulation of electric rates to the process in place before 1999. "At the end of the day what we’re after is trying not to put the power company out of business. We all need electricity," Armstrong said, "but to allow them to earn what they need to cover their costs and a reasonable profit, and no more."
Appalachian Power argues it isn’t Virginia’s regulation of the industry that’s lead to higher bills, but the cost of mandated environmental controls, and the rising cost of coal. "Customers deserve to know the real reason why rates had gone up in recent years," Burns said during an interview. "The real reason is the expenses we’ve had to incur."
The first stop for Armstrong’s legislation is a commission that failed to endorse his proposal last year. No matter what happens there, Armstrong says he will have other opportunities during the current General Assembly session to push for electricity rate reform.