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State Manufacturers Line Up Against Rate Hike Request; Alcan, Century Aluminum Latest to Join Fight
Friday, April 17, 2009 9:54 AM


(Source: The Charleston Gazette)trackingBy Eric Eyre, The Charleston Gazette, W.Va.

Apr. 17--CHARLESTON, W.Va. -- Alcan Rolled Products and Century Aluminum are joining the fight against Appalachian Power's proposed $442 million rate hike.

, Jackson County's largest employer with more than 1,000 workers, says the increase would devastate the company and make it impossible for the Ravenswood plant to compete, according to a filing with the state Public Service Commission.

, which employed 500 workers before shutting down in February, also alleges the electric rate hike would "severely and adversely" affect the company.

Appalachian Power has blamed Century Aluminum for $12.9 million of the $100 million in losses the utility sustained last year.

The power company wants to recover its losses through the massive rate increase.

But the Public Service Commission's Consumer Advocate Division fears those costs could be shifted to residential customers.

The consumer division has urged the state Public Service Commission not to allow that to happen.

"Century doesn't want to pay for it," said Byron Harris, who directs the Consumer Advocate Division. "Appalachian Power wants to charge for the under recovery and get it back from Century, rather than from everybody else."

The Public Service Commission issued an order this week, allowing Alcan and Century Aluminum to intervene in the case. They join the West Virgina Energy Users Group -- made up mostly of chemical manufacturers -- and other large companies already fighting the rate hike.

Also Thursday, the Consumer Advocate filed a report, declining to take a position on Appalachian Power's interim request to raise electric rates 18.5 percent on July 1 -- while the PSC considers a previous proposal to increase rates over the next three years.

The power company has said any further delays -- the commission doesn't expect to rule on the multiyear rate hike request until December -- would add $122 million to the company's projected losses.

The consumer division said Appalachian Power's customers should not have to pay such a large rate increase until the commission reviews the merits of the power company's proposed increase.

But the consumer advocate also acknowledged that Appalachian Power customers would have to pay higher rates "sooner or later," as state law allows utilities to recover energy costs.

"It will be far less burdensome on customers and [Appalachian Power] to begin paying off these costs now, rather than waiting and allowing the under recovery to soar to astronomical levels," wrote Jennifer Lee Stollings, lawyer for the consumer advocate.

The West Virginia Energy Users Group wasn't so diplomatic.




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