RICHMOND — The State Corporation Commission (SCC) has
approved a request by Appalachian Power Company (APCo) to recover $26.1 million
in costs associated with the acquisition and operation of the Dresden Generating
Plant, a facility under construction and previously owned by a generation affiliate
of American Electric Power.
The rate adjustment, added as a rate rider allowed by Virginia law, will become
effective for service rendered on or after March 1, 2012. The new charge will increase
the monthly bill of a residential customer using 1,000 kilowatt hours of electricity
by approximately $2.08.
In APCo’s recent base rate case (PUE-2011-00037), the Commission reduced the company’s
requested revenue increase by $27.53 million to reflect APCo’s planned acquisition
of the Dresden facility. In the base rate order, the Commission stated “The acquisition
of the Dresden Generating Facility will reduce the Company’s capacity equalization
charges once the facility is placed in service,” and accordingly reduced the company’s
base rate request.
In a prior order authorizing APCo to acquire the Dresden facility (PUE-2011-00023),
the SCC found “… it appears that APCo’s customers will benefit from APCo’s ownership
of the Dresden Plant,” due to its effect on potential future capacity payments.
The Dresden Generating Plant is a 580 megawatt natural gas-fired combined cycle
power plant located near Dresden, Ohio. Appalachian Power projects that Dresden
will begin commercial operations on or about February 29, 2012.
Case Number PUE-2011-00036