Coal Association: Utility’s Plan Could Hasten Plant Retirements

A plan under review by the West Virginia Public Service Commission opens a door for the retirement of three coal plants, an industry group says.

Appalachian Power is seeking the PSC’s approval to securitize more than $2 billion in costs, including the current value of its three coal plants in West Virginia.

That would involve issuing bonds that would be paid back by electricity customers over a 20-year period. Appalachian Power has offered the plan as a way to save customers money versus a regular rate increase.

The West Virginia Coal Association, however, has warned the PSC that the plan could make it possible for Appalachian Power to retire its Amos, Mountaineer and Mitchell plants before 2040.

Securitization has been used in other states for that purpose.

Under House Bill 2014, which the legislature enacted this year, Appalachian Power would have to seek the approval of the PSC to retire any of the coal plants.

The coal association says in a filing this week that the closure of those plants would outweigh any savings to electricity customers and that the PSC should not allow it to happen.

If the PSC approves Appalachian Power’s securitization plan, the average monthly residential bill would increase $6.72 a month, lower than another proposal that would add $23.74 to the average electricity customer’s bill.

The commission has held evidentiary hearings on both proposals, including a public hearing that drew dozens of speakers, all of them opposed to a rate increase.