Senators: Virginia 'better off with anything but Appalachian Power'

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Roanoke, VA (Cardinal News)

Citing "ever increasing bills," three state senators from Southwest and Southside asked regulators whether Virginia can end the utility's monopoly.

Three Virginia senators on Thursday said that they sent a letter to state regulators asking how to remove Appalachian Power's monopoly status as an electricity provider or end its ability to do business in the commonwealth.

Citing "ever increasing bills," Sens. Bill Stanley, R-Franklin County; Todd Pillion, R-Washington County; and Travis Hackworth, R-Tazewell County, said that "our region deserves better than an out-of-state company who doesn't work with [its] struggling customers and continually works to extract maximum profit for an essential utility service."

"The situation has become untenable, and we respectfully believe that Virginia and our area in particular are better off with anything but Appalachian Power Company," the senators wrote.

Appalachian Power representatives did not respond to a request for comment.

The utility, a subsidiary of Columbus, Ohio-based American Electric Power (NASDAQ:AEP), has about 540,000 customers in western Virginia, including about 466,000 residential customers.

The average Appalachian Power monthly residential bill has risen about $50 in the past three years to $174. Lawmakers during the current General Assembly session have shared anecdotes about constituents paying hundreds of dollars more than that, with some seeing monthly bills above $1,000.

Stanley, Pillion and Hackworth are among lawmakers who have backed legislation this year that attempts to deal with rising customer costs.

Bills that have passed the Senate and House would allow Appalachian to package certain large expenses into interest-bearing bonds that it sells to investors. Supporters of that financing mechanism, called securitization, say it can lower customers' monthly bills by spreading those costs over a longer time at favorable terms, but critics say it costs ratepayers more in the long run.

The two bills have had other ideas variously attached to them, including forbidding rate increases during certain winter months, requiring Appalachian to implement lower seasonal winter rates and prohibiting the utility from disconnecting residential service for late payment between July 1, 2025, and Dec. 31, 2026. The final version of the legislation has yet to be worked out.

Separately, Hackworth and Pillion backed a bill that would have created a pilot program to allow local governments to buy electricity from other providers on behalf of businesses and residents. It failed in subcommittee.

In their letter, the senators asked the State Corporation Commission whether the General Assembly or the SCC has the authority to revoke Appalachian's monopoly status and what the cost to residents would be if that happened.

The SCC regulates utilities in Virginia, and its three commissioners are chosen by the General Assembly to serve six-year terms. The commissioners handle cases such as when Appalachian Power requests permission to raise its electric rates.

Virginia residents have been mostly unable to shop around for electricity since 2007, when lawmakers enacted sweeping changes to utility regulation that included ending residential electricity choice unless the power comes from 100% renewable sources.

At that time, the average Appalachian Power residential monthly bill was about $66, or a little more than a third of what it is today.

In a statement, the executive director of the Charlottesville-based nonprofit Clean Virginia called the senators' letter "a critical stand" against an "unchecked monopoly" and noted that Appalachian's rates have risen faster than the rate of inflation in recent years.

"When a monopoly fails to deliver fair, affordable service, the State Corporation Commission and our legislators must explore alternatives that better serve the people," said Brennan Gilmore, whose organization has a stated mission of "fighting utility monopoly corruption in Virginia politics."

In their letter, the senators asked if the SCC sees alternatives to address the utility's "extreme customer service deficiencies."

The senators said in their letter that their attempts to work with Appalachian to address rising customer bills "have seemingly fallen on deaf ears."

"During our numerous attempts to find solutions that work for all parties, APCO has not only failed to provide solutions, but they have also insulted the lived experiences of their customers and attempted to convince us all that the problem lies with our overuse of electricity," the senators said in a joint statement separate from the letter.

"No more. We look forward to receiving answers from the State Corporation Commission and acting on that information in the days ahead."

This story is provided as a service of the Institute for Nonprofit News’ On the Ground news wire. The Institute for Nonprofit News (INN) is a network of more than 475 independent, nonprofit newsrooms serving communities throughout the US, Canada, and globally. On the Ground is a service of INN, which aggregates the best of its members’ elections and political content, and provides it free for republication. Read more about INN here: https://inn.org/.

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