Published: November 19, 2008 10:30 pm      

Electricity rates going up, official says

Appalachian Power President and COO Dana Waldo says the bad news is that like other utilities, electricity rates for consumers are going to go up.

“The demand is increasing at the same time costs associated with producing electricity are going up as well,” Waldo told a crowd of community leaders during a Wednesday lunch at Black Knight Country Club in Beckley.

Waldo said the cost of coal is 125 percent higher than a year ago.

“Add in the rising costs of fuel, new environmental controls and the need for new transmission and generators unfortunately means that electricity rates will rise as well,” he said.

Waldo says Americans are using 21 percent more electricity per household than in 1978.

“There are more people with large homes using more electric appliances than ever before in our nation’s history,” he said. “More air conditioning is being used, along with more computers, digital equipment and other electrical appliances.”

In addition, the coal-fired power plants in the country must invest billions of dollars into equipment to make the plants more environmentally friendly and burn coal cleaner.

“American Electric Power, which Appalachian Power is a subsidiary, will invest $5 billion in scrubbers and other equipment to meet new federal environmental controls,” Waldo said.

Waldo says Appalachian Power increased its rates 11 percent last year, but it was only to recover the company’s increased costs to produce electricity.

“There was no profit and the majority of the increased costs was due to the increased cost of coal,” he said.

Waldo said all of Appalachian Power’s consumer rates are cost-based.

“Those costs are reflected in customers’ prices,” he said.

Waldo said some customers have suggested that rate increases be tied to the rate of inflation.

“If we did that, customers would be paying 55 percent more on their electric bills since 1983,” he said.

The good news for consumers is that there are many ways customers can save on their electric bill, according to Waldo.

“Compact fluorescent light bulbs are a great way to save energy and money in your home,” he said. “They are designed to directly replace incandescent lamps. They provide the best features of fluorescent lamps, which include longer life, lower operating costs and less heat gain. Also, monthly budget payments help you even out your electric service costs. Your bills will be more equal, not spiking as high in months when it’s really hot or cold.”

Other tips, like unplugging electricity-using equipment and appliances when they are not in use and replacing old appliances with new energy-saving appliances, were suggested.

“We have a Web site, www.wattwhyandhow.com, that offers several tips for customers to save money on their monthly electric bill,” Waldo said. “This information is very important for those on low- or fixed-incomes.”

The company is also offering “green” pricing for those wanting their power from sources other than a coal-fired power plant.

“This premium rate allows us to invest more into alternative power sources,” Waldo said.

Overall, Waldo says West Virginia customers still have some of the lowest electricity rates in the world.

“The national average for electricity is 13 cents per kilowatt hour, while in West Virginia the average is 7.2 cents,” he said.

— E-mail: fpace@register-herald.com