Appalachian Power requests another rate increase for utilities: What it could mean for your monthly bill

Published: Apr. 5, 2023 at 6:30 PM EDT
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ROANOKE, Va. (WDBJ) - Appalachian Power has submitted a triennial application request to the State Corporation Commission (SCC) to raise the base rate cost of electricity.

APCo reports the cost of labor and equipment has gone up, which means it needs to charge customers more to make up the difference. The company requested to increase the base rate by about 16%.

That means if it’s approved, it will cost customers about $20 more per 1,000 kWh used.

The proposed base rate increase of $212 million comes after the SCC approved APCo’s fuel factor rate increase in November, which was attributed to inflation. Those increased rates mean customers could be paying $40 more per 1,000 kWh. The base rate increase comes from inflation as well.

“It would just add to the cost that’s already there, due to the fact that the cost of everything is going up,” APCo spokesperson Teresa Hamilton Hall said.

While the fuel factor specifically deals with the cost of energy, the base rate is the cost of labor, equipment and service maintenance.

“With that additional funding, we would be able to go in and tackle some of those worst performing circuits, go in and trim trees and brush some of those trees that need to be removed,” Hamilton Hall said. “This is all within our right of way.”

APCo has requested approximately ten rate changes in the last two years. There have been about seven rate increase requests and three rate decrease requests to customers’ overall cost.

“We have a lot of transmission work that is going on within our company and so we could also file a transmission application that could occur sometime this year,” Hamilton Hall said.

WDBJ7 asked APCo if the company considers how the increases may impact a customer’s financial stability before making the request.

“We certainly do. Our first obligation is to provide safe and reliable power for our customer,” Hamilton Hall said. “Under the proposal we have a program where about 7% of our customers would no longer have to pay the basic service charge for electricity. This would result in a savings of about $100 a year for these customers.”

The proposed program would apply to low-income customers, as determined by a state agency.

The proposed increase would go into effect in January 2024. The application is now before the SCC, which will make a decision whether to approve, deny or modify the application.