PSC: Return tax cut savings to customers
CHARLESTON — In a ruling from the bench Friday, the Public Service Commission of West Virginia approved joint stipulations and agreements for settlements and proposed rates for utility companies ordering rate reductions of $84.8 million per year beginning Sept. 1.
It also approved the elimination of approximately $151.4 million in recoverable costs that, in the absence of this decision, would have been included in current expanded net energy cost and vegetation management plan surcharge increases proposed in the Appalachian Power and West Virginia American Water rate cases currently before the PSC, the agency said in a news release.
Additionally, the PSC approved agreements that provide the aggregate amount of approximately $409.3 million in excess accumulated deferred income taxes to be credited to customer rates in the future.
The PSC said it will be issuing an order in the near future that follows up Friday’s bench ruling.
In January, the PSC directed all privately owned electric, gas, water, sewer and solid waste facilities to begin tracking the savings resulting from the 2017 Federal Tax Cuts and Jobs Act on a monthly basis.
On Friday, the PSC approved settlements for Appalachian Power, Wheeling Power, Monongahela Power, Potomac Edison, Mountaineer Gas, Beckley Water and West Virginia American Water.
In a major provision of the settlement with Appalachian Power, the company will credit back to customers $25.5 million over a six-month period from September 2018 through February 2019, a 3.8 percent reduction in customer rates.
A residential customer using 1,000 kilowatt hours (kWh) a month will see a $3.56 reduction in their monthly bill, and for a customer using 2,000 kWh/month, the reduction would be $7.12, the power company said in a separate news release.
In addition to the six-month bill reduction, Appalachian Power said tax benefits will be used to pay off costs related to 2012 storms and certain power generation projects that would otherwise be paid by customers. In a news release, the power company said it will reduce the company’s previously requested rate increase from $115 million to $98 million, and a decision by the PSC in that case is expected in the first quarter of 2019.
“We’re pleased to be able to reach agreement on a method to return tax dollars to customers that reduces rates now and addresses a number of issues that will benefit customers in the long term,” Appalachian Power President and COO Chris Beam said in the release.
The PSC staff, Consumer Advocate Division, WV Energy Users Group and Steel of West Virginia worked with the company to reach the settlement agreement. Kanawha County and the city of Charleston did not sign the agreement but are not opposing it.
More information is available on the PSC’s website, www.psc. state.wv.us, by referencing GO 236.1.