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PSC Approves Continued Operation of Three Coal-fired Power Plants

CHARLESTON, WV – The Public Service Commission has approved Appalachian Power Company and Wheeling Power Company’s request to keep the Amos, Mountaineer, and Mitchell plants operational until at least 2040.

The Order will not immediately affect the power bills of West Virginia customers.  The Commission’s August 4, 2021 Order in this case increased the monthly bill of a residential customer using 1,000 kWh per month by approximately 38 cents. 

That rate increment was the first year phase-in of the impact of a multi-year construction program.  It was originally estimated that the impact to residential customers (using 1,000 kWh per month) once the Coal Combustion Residue (CCR) and Effluent Limitation Guideline (ELG) revenue requirements are totally phased-in upon completion of construction of all the required upgrades would be approximately $2.64 per month. 
The rate impact of the full phase-in upon completion of construction, including any additional amount that results from yesterday’s Order will require the companies to file a further proceeding to recover the costs of implementing the upgrades.

The estimated cost to bring all three plants into federal environmental compliance is $448.3 million.  The estimated cost to West Virginia customers of prematurely retiring the three power plants and replacing their collective generation capacity is between $1.9 and $2.3 billion.

The Order points out that benefits of the plants’ continued operation to the state’s economy are considerable.  Direct employment at the plants; use of West Virginia coal; state, county and local taxes related to operating generation plants; and related employment in businesses supporting the plants and the coal industry cannot be discounted or overlooked.  The Commission also considered the reliability of fuel secure base load generation capacity in making its decision.

Yesterday’s Order is the result of Virginia and Kentucky refusing to approve the ELG upgrades required for the plants’ continued operation.  The Commission determined that if those two states will not share the cost of the upgrades, they will not be permitted to use the capacity and energy produced by the plants.

The announcement drew criticism from AARP West Virginia State Director Gaylene Miller.

“On behalf of West Virginia consumers, AARP expresses its deep disappointment in the Public Service Commission of West Virginia for approving a half-billion utility rate hike for Appalachian Power and Wheeling Power customers. With this decision, the Commission has essentially abandoned its mission to balance the interest of current and future utility service customers with the general interest of the state’s economy and the interests of the utilities, tipping the scales in the favor of the utilities providers and against the West Virginia consumer.’

“After being soundly rejected by state regulators in Kentucky and Virginia, the American Electric Power-affiliates came to West Virginia ratepayers seeking relief. The overwhelming majority of public comments submitted during this case’s short, expedited timeline showed West Virginia industrial and residential ratepayers were strongly opposed to this proposal for cost recovery. Thanks to the swift action of the Commission, American Electric Power will recoup its half-billion investment solely on the backs of West Virginia ratepayers, who will continue to export power they’re paying to produce to others states while seeing their own utility bills escalate for the foreseeable future,” continued Miller.