Sunday, May 13, 2018

West Virginia Residents Brace For Higher Utility Rates

Appalachian Power, which serves nearly half a million customers in West Virginia, is asking for a whopping eleven percent rate increase. Roughly half of the requested hike “is due to a significant decline in the amount of electricity used by customers,” the company said.

West Virginia American Water Company, the largest water company in the state, has asked for a staggering 24 percent rate increase. According to a news release, the company said the increase request is due to infrastructure improvements. The company also cites a decline in the amount of water customers use.

After being hammered with constant rate increases from these two companies over the years, West Virginia consumers have cut back on water and electricity usage in order to lower their bills -- only to learn that conservation now apparently doesn't matter, because their bills are still going up.

The West Virginia Public Service Commission will rule on these proposed rate increases. However, the commissioners are chosen by the same legislators who benefit financially from the utilities they are supposed to be regulating. If past decisions are any indication of what's to come, both companies will receive at least a portion of what they are asking for.

West Virginia’s historically cheap utility rates have long been touted as an advantage to attract people and businesses to the state, but that advantage is rapidly shrinking due to the never-ending procession of price hikes from Appalachian Power and West Virginia American Water Company.

State leadership in Charleston has had very little to say about either of these proposed rate increases because these utilities have so many legislators in their back pocket. For example, between 2004 and 2018, Ohio-based American Electric Power, the parent company of Appalachian Power, donated more than $1.1 million to West Virginia political candidates.

Utility companies have a long history of undue influence in West Virginia politics, and Heaven help anyone who points this out. One person testifying before the House Judiciary Committee, Lissa Lucas,  was forcibly removed when she began naming these companies and whose campaign coffers they had filled.

It's rather ironic that both utilities often enclose helpful conservation tips in their paper statements, since conversation is now apparently a driver of higher rates.

For now, state residents must sit and wait while the Public Service Commission deliberates on the rate increase requests and makes a ruling, a process that can take up to 300 days.

If past PSC decisions are a reliable barometer, an increase is a foregone conclusion. The companies might not get everything they want, but it's a near-guarantee they'll get a sizeable chunk of it.

It must be great to operate a company in an environment where your customers cannot choose a competitor. They are bound to you no matter what.

While West Virginia consumers shoulder the burden of higher electric and water costs, the providers of these utilities will be laughing all the way to the bank -- and undoubtedly rewarding the legislators in Charleston who do little or nothing as the rate increases merrily roll in, year after year.

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