Senate to vote today on APCo interim rate hike bills

The Virginia Senate is expected to approve identical Senate and House of Delegates legislation today that would suspend Appalachian Power Co.’s 12.5 percent interim rate increase until the State Corporation Commission rules on the rate hike request.

If that happens and the House approves the Senate bill, the compromise legislation is expected to go to Gov. Bob McDonnell next week, officials said. Del. Ward Armstrong, D-Collinsville, and House minority leader, said he has not talked with the governor, but he can’t imagine that McDonnell would not sign the bill. If he does, the legislation would go into effect immediately because it contains an emergency clause, officials said. Also, a bill introduced by Armstrong to return Appalachian to regulations in place in the late 1990s before deregulation was approved 7-4 by a House subcommittee Tuesday. That bill is scheduled to go before the House Committee on Commerce and Labor today, according to Armstrong and the General Assembly Web site. “As we speak,” Armstrong said late Wednesday afternoon, Appalachian Power “and their legion of lobbyists are pounding the halls of the General Assembly trying to kill my bill.” That indicates to Armstrong that the bill is “on the right track” and that “it’s going to be a tough fight to get this through committee.” The Senate bill to suspend Appalachian Power’s interim rate increase evolved from one originally introduced by Sen. Phillip P. Puckett, D-38th District. Puckett said he originally proposed a bill similar to one filed by Sen. Roscoe Reynolds, D-Ridgeway, to return Appalachian to regulations that existed before deregulation. The current bill, which a Senate committee substituted for Puckett’s original bill, was the result of a compromise between some legislators and Appalachian Power, Puckett said. “I agreed to have my bill changed to lift interim rates to give immediate relief to Appalachian Power customers,” he said. Under the House and Senate bills, Appalachian would suspend the interim rate increase until the SCC makes a ruling by July 15, “for rates to become effective for bills rendered on and after” Aug. 1. Puckett said that in the meantime he hopes to carry on negotiations with Appalachian Power to try to get rates that are fair to the company and customers and that allow the company to get a fair rate of return. He doesn’t think the rates are fair now, he said. Wednesday, Armstrong expressed concern that “last week (Appalachian Power) said they had reached an agreement with a number of legislators that in return for rolling back the interim rate increase that all other pieces of legislation would be defeated. The first inquiry I had was who made this deal? No deal was made with me. Moreover, why do we need to make a deal with” Appalachian that is not in the best interest of the public. Armstrong added that he is does not object to the lifting of the interim rate increase — “that’s a good thing — but it’s limited.” Armstrong said he has been told by the SCC that a customer using 1,000 kilowatt-hours a month would save about $12 a month if the interim increase was lifted. In his district, families use an average of about 1,200 kwh a month, which would be a $15 a month reduction. If the suspension of the interim rate increase is approved, it would last “maybe four or five months, and that’s all. I’ve characterized that as a good first step. By no means is that all we should be doing.” “We need to have regulatory reform regarding Appalachian. The only thing I know we can do quickly is go back to” the regulation that was in effect before deregulation, he said. Those regulations were in place for many years when Appalachian did not seek rate increases, he said. Another bill of Armstrong’s that is scheduled to come before a House committee today would consolidate, “or bundle,” Appalachian’s rate increase requests, he said. He added that in theory would result in lower increases. Todd Burns, corporate communications manager for Appalachian Power, said the company would like the interim-rate compromise bill that it worked out with most legislators in Appalachian’s service area to move forward. “It would provide immediate benefits for customers,” and he hopes it moves quickly, he said. Of Armstrong’s bill to return Appalachian to regulations in place before deregulation, Burns said, “we hope it goes nowhere. The bill would return Appalachian to a style of regulation that the General Assembly thought was outdated years ago.” He has said that much of the recent increase in electric bills is because of customers using more power because of prolonged cold weather.

By PAUL COLLINS

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