RICHMOND — The State Corporation Commission (SCC) will hold a hearing on December 4, 2007, to consider a $45 million rate increase request by Allegheny Power. The proposed increase results in an adjustment to rates of about 26.7 percent when averaged across all customers the company serves in Virginia.

Allegheny Power is asking the SCC to allow recovery of purchased power costs since July 1, 2007, that the company contends are not subject to the provisions of an agreement reached in 2000 when the company voluntarily transferred its generation units to an affiliate. The agreement capped rates on electric generation services.

In that 2000 agreement, the company agreed to abolish its fuel factor recovery mechanism. Instead, purchased power costs were rolled into the company’s base rates which are currently capped under Virginia law through the end of 2008.

The request represents the purchase of electricity above the level of generation the company owned to serve Virginia customers at the time of the agreement (367 megawatts). In setting the matter for hearing, the Commission denied the company’s request to place its proposed rate into effect prior to the conclusion of the proceeding.

The hearing will begin on Tuesday, December 4, 2007, at 10:00 a.m. in an SCC courtroom on the second floor of the Tyler Building located at 1300 East Main Street in downtown Richmond. Any public witness should arrive early and sign in with the Commission bailiff.

Written comments on the rate request must be submitted by November 16, 2007. All correspondence should be sent to the Clerk of the State Corporation Commission, Document Control Center, P.O. Box 2118, Richmond, Virginia 23218-2118, and refer to case number PUE-2007-00085.

Interested persons desiring to submit comments electronically may do so at the SCC’s website: www.scc.virginia.gov/case/. Click on the PUBLIC NOTICES link and then the SUBMIT COMMENTS button for case number PUE-2007-00085.

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Case number: PUE-2007-00085