Appalachian Power on Friday said it is seeking a rate increase that, if approved, would raise the average customer’s monthly bill by about $10.
The electric utility’s request to the State Corporation Commission comes after a separate increase took effect earlier this year that raised the average residential bill by about $16. The utility defines an average customer as one who uses 1,000 kilowatt-hours of electricity per month.
The latest request is the first under a new state law that requires Virginia’s second-largest electric utility to file rate review requests with the SCC every two years instead of every three. The $16 average monthly increase earlier this year was the result of the last triennial review.
“We recognize these are challenging financial times and no one wants to experience rising electric bills,” Appalachian President and COO Aaron Walker said in a news release. “Our customers need safe and reliable service, and we work hard to meet those expectations while keeping costs as low as possible.”
If state regulators approve the request, it would not take effect until January 2025 for the utility’s approximately 540,000 customers in western Virginia, Appalachian said.
Appalachian said the higher base rate is needed to increase its revenue by about $95 million, or 5.1%.
Factors contributing to this need, Appalachian said, include the cost of restoring service during major storms; increase in capital, material and labor costs; and rising interest rates.
It also includes costs associated with the utility’s vegetation management program, which aims to improve service reliability for customers where tree-related outages are common.
“We know trees are the number one cause of outages. With our newly approved program, we’ll be able to enhance our efforts to prevent and reduce the duration of outages in areas that have experienced the most service interruptions,” Walker said.
A Nov. 1 report from the SCC calculated that Appalachian’s typical monthly residential bill increased by $91.01, or 136.63%, between July 1, 2007, and July 1, 2023.
For context, the U.S. Bureau of Labor Statistics says inflation in the U.S. rose 47% during that time.
The average Appalachian Power residential monthly bill rose by about $35 just between July 2022 and July 2023, to $157.62, according to the SCC report.
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