Appalachian Power to reduce fuel rates in Virginia
Appalachian Power is seeking approval from the Virginia State Corporation Commission to reduce the fuel rate for its customers in Virginia.
Fuel costs account for about 20 percent of a residential customer’s electric bill. The fuel factor recovers those costs, which are mostly for natural gas and coal. The current fuel factor is 2.3 cents per kilowatt-hour (kWh). Appalachian’s proposal would reduce it to 1.999 cents per kWh. This would result in a savings of $3.01 for a customer using 1,000 kWh/month.
“Managing fuel costs is an important part of service delivery,” Chris Beam, Appalachian Power’s president and chief operating officer, said. “What we’ve witnessed over the past several months is a drop in natural gas costs. Our request before the SCC ensures that approximately $40 million in savings is passed along to our customers.”
If approved, the reduction will take effect in November. With the adjustment, Virginia residential customers using 1,000 kWh/month will pay 10.6 cents/kWh. This is below the national average cost for residential electricity of 12.93 cents per kWh, according to the Edison Electric Institute’s (EEI).
The commission reviews fuel rates each year to determine whether it should be increased or lowered.
Appalachian Power is a subsidiary of American Electric Power.
