Appalachian Power seeks a rate increase with the State Corporation Commission
If approved, the increase would take place after March 1, 2026.
In what appears to be a show of defiance or a display of the middle finger to Virginia General Assembly members from SWVA on their plan to reign in AEP (Appalachian Power) and rate increases, the energy utilities company announced that they are seeking permission from Virginia regulators to charge customers to recover money it has spent on renewable energy projects and on complying with environmental laws.
If the State Corporation Commission approves Appalachian’s requests, The average residential customer’s monthly bill would go up by $6.63, or about 3.8%, according to documents recently filed with the SCC. The increase would not occur before March 1, 2026.
The proposal comes as the average Appalachian monthly bill has risen by about $50 since July 2022 to about $174 today.
According to a published story in Cardinal News, separately Appalachian is asking for permission to continue evaluating its Joshua Falls property in Campbell County for a potential small modular nuclear reactor, or SMR. Such reactors are designed to be smaller than traditional nuclear reactors, but no commercial SMR has been deployed in the U.S.
(See our related article about TVA applying for a small modular reactor here.)
The SCC’s approval is necessary before Appalachian can ask permission to charge customers for related SMR project development costs. The utility has not shared a dollar figure that it expects to recover, but a 2024 state law caps SMR project cost recovery at $125 million.
“These filings reflect the company’s commitment to a sustainable and reliable energy future for Virginia,” Appalachian Power said in a news release last week.
The proposed $6.63 average bill increase would come from two requests.
One would allow Appalachian to recover $68.9 million in costs associated with renewable energy projects that are either making electricity now or will come online between March 2026 and February 2027. It would raise the average residential monthly bill by $4.36.
The other would recover the $60.6 million the utility spent ensuring that its coal and natural gas power plants comply with state and federal environmental regulations. It would add $2.27 to the average residential bill, according to the company’s filings.
The SCC could approve or deny the requests or approve lower revenue amounts than what Appalachian requested.
Looking further into the future, Appalachian told regulators that it wants to add a solar project in Wise County, a battery energy storage system in Wythe County and a wind project in Illinois to its renewable energy portfolio.
Appalachian wants to operate a Wythe County battery energy storage system that could provide 52 megawatts of power for up to four hours.
The system is under development on 8 acres of land at the same location as Wythe County Solar, at 669 Electric Lane in Max Meadows, according to the developer, RWE. It’s slated to begin operating in mid-2027.
Appalachian already has received approval for a battery energy storage system on its Glade-Whitetop circuit in Grayson and Smyth counties that would be able to deliver 7.5 megawatts of energy for up to four hours.
Appalachian told regulators that it plans to purchase electricity for 28 years from the 7.5-megawatt HCE Collier Solar project in Wise County once that facility begins operating in May 2027.
