RICHMOND — The State Corporation Commission (SCC) has confirmed a four percent fuel rate increase for Appalachian Power Company.

Appalachian customers have been paying higher interim rates since January 1, 2007. That is when the requested increase was allowed to go into effect on an interim basis pending an SCC decision.

The SCC's final order issued on February 14, 2007, allows Appalachian to collect an additional $38.7 million in annual operating revenue by raising its fuel factor to 2.030 cents per kilowatt-hour (¢/kWh) from 1.785¢/kWh. The average residential customer using 1,000 kWh in a month will see an increase of $2.45, or 3.2 percent on a monthly bill.

The company said the increase was necessary to meet the rise in the projected costs of fuel to generate electricity in 2007.

Appalachian also has pending before the SCC a request to increase base rates, the portion of the monthly bill that accounts for the company's operating costs. The company has requested an increase of $198.5 million. Interim rates reflecting this 25 percent increase took effect October 2, 2006.

Appalachian, a unit of American Electric Power, serves approximately 500,000 residential, commercial, and industrial customers in 31 counties in southwest Virginia.

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Case Number PUE-2006-00100