Rate hikes may bust budgets

Nov 29 - McClatchy-Tribune Regional News - Greg Jordan Bluefield Daily Telegraph, W.Va.

Local lawmakers are opposing rate increases requested by two utilities and seeking ways to make utilities more sensitive to the financial strains facing the state's consumers.

Appalachian Power is seeking a 13.8 percent base rate increase, and West Virginia American Water is looking for a 15 percent rate increase. The West Virginia Public Service Commission will hear the water company's case from Dec. 6-10 and the electric company's request from Dec. 13-15. Both hearings are open to the public and will be streamed live on the Internet.

A letter received by the Bluefield Daily Telegraph asked whether the state PSC considers the public's ability, or inability, to pay for a utility rate hike when deciding whether to grant a request for an increase. Susan Small, a spokeswoman for the commission, said public comment is taken into account when the PSC considers whether to grant a rate increase. A court reporter is present during the public hearings and public testimony is a formal part of the case.

Local lawmakers said they have opposed new water and electric rate increases.

"Utility rate increase and the public service commission are two of the most frustrating things I've had to deal with in the Legislature," said Delegate John R. Frazier, D-Mercer. "I've probably had more citizens' complaints about that than any other issue, yet it's not something we deal with directly."

The state PSC is really an independent agency, Frazier said. It is only subject to appeals to the West Virginia Supreme Court of Appeals, and those appeals "are heard very rarely."

Frazier said one of his priorities during the upcoming legislative session is to introduce a bill that will require the PSC's members to be elected by the state's citizens instead of being appointed by the governor.

"I do believe they would be more responsive that way because they would be elected by the people, and the citizens would feel empowered because they can select the individuals who would oversee utility rate increase applications," Frazier said.

Members of the public have complained that the PSC has been a "rubber stamp" that readily grants rate increases.

"I agree with that," Frazier said. "Most people feel that way, that they are a rubber stamp. We need to look at other reforms without changing the whole utility system, and it's a complicated system. We want these utilities to provide the service and make a reasonable profit, but they need to provide it at affordable rates."

Senate Majority Leader H. Truman Chafin, D-Mingo, said he has spoken against the rate increase requested by Appalachian Power. He said he was unable to attend a hearing concerning the proposed water rate increase.

Chafin said power customers who use 1,000 kilowatt hours a month will see their monthly bill rise from $86.44 to $99.22, an increase of $12.78 per month. The increase for other customer classes, like commercial or industrial customers, will range from 12 to 15 percent.

"Utility providers need to be reasonable in seeking these increases," Chafin said. "West Virginians are facing challenging economic times, particularly older West Virginians who are still reeling from the news of no Cost of Living Adjustment (COLA) in the Social Security income for a second straight year. The state's natural gas utility providers and state regulators have taken advantage of favorable market conditions to provide economic relief to West Virginia consumers and families in need, with their recent decision to lower natural gas rates for the winter months."

On the subject of whether PSC members should be elected, he would want to speak with new Gov. Earl Ray Tomblin to see whether there would be any support for each a measure. Being able to appoint PSC members would be a duty the governor would have to give away. In similar debates, legislators have asked whether other appointed posts could become ones placed on the ballot if PSC commissioners had to run for election.

"While I'm not against it, I'm open to it and would listen to the debate," Chafin said. "I would want to know if the governor would support it before getting too far in the debate."

State Senator Mark Wills, D-10th District, who was sworn in Nov. 22, said the rate increases and their impact on residents should be addressed.

"With the way the economy is right now, I'm opposed to increasing these rates. They're having a hard enough time the way it is," he said of the state's residents. "How are they going to heat their homes every year? And of course for the elderly and people on fixed incomes, there's only so much to go around."

When asked about the idea of electing PSC commissioners, Wills said he would have to research the proposal before forming an opinion about it.

Delegate Joe Ellington of Princeton, who was recently elected to help represent the 25th District, said he did not want to see utility rate increases, but he did not know all of the expenses utilities are facing.

"I'll have to see what they have to really recoup," he said. "I would probably be opposed to them (rate increases)."

Ellington said he "did not have a problem" with the idea of the public electing PSC commissioners.

-- Contact Greg Jordan at gjordan@bdtonline.com