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Mon Energy, Potomac Edison reply to criticisms leveled of their rate-hike plan

MORGANTOWN – Mon Energy and Potomac Edison provided some defenses towards criticisms leveled towards them in considered one of their rate-hike circumstances, in a current submitting with the Public Service Fee.

However they did comply with a number of the options provided.

On this case, they’re asking for $167,465,330, which they venture would add $9.19 to the typical month-to-month residential invoice, elevating it from $120.20 to $129.39 — a 7.8% hike. It’s an ENEC case — expended web power price — designed to permit utilities to cowl their prices of manufacturing energy.

Earlier this month, Philip M. Hayet testified on behalf of West Virginia Vitality Customers Group, a bunch of huge industrial prospects of Mon Energy and Potomac Edison. He stated the proposed hike imposes vital will increase in ratepayer payments.

WVEUG proposed that as a substitute of approving two ENEC fee hikes in 2024 – on Jan. 1 and an adjustment on March 27 – the PSC approve a single 2024 ENEC hike coinciding with a separate base fee improve anticipated on March 27.

And as a substitute of spreading ENEC hikes throughout two years, as the businesses proposed on this case (asking this time for $167.5 million of a complete $243,032,313 under-recovery), WVEUG recommends spreading it throughout three years. And that the businesses be directed to forego submitting a 2025 ENEC case, that means they’d not make an ENEC submitting in August/September 2024 for brand new charges to be efficient on January 1, 2025. They’d then file their subsequent ENEC case in August/September 2025 for brand new charges in 2026.

Raymond E. Valdes, representing Mon Energy and Potomac Edison, stated he doesn’t agree with delaying the ENEC fee change from January to March, or with the extra yr proposed for restoration.

Price hikes are alleged to be gradual, he stated, to mitigate massive and abrupt adjustments in buyer payments. So, synchronizing this case with the bottom fee case in March would end in a big and abrupt change in buyer payments. The businesses wish to decrease the influence by having most of their ENEC improve happen on the normal date: Jan. 1, with the small adjustment in March,

He additionally disagreed with the concept of spreading the hike throughout three years and delaying their subsequent (often annual) ENEC case to September 2025.

That proposal units up a three-year delay for the restoration of ENEC-related prices, he stated. “ENEC-related prices will be unstable and troublesome to forecast attributable to consistently altering market dynamics in addition to weather-related variations that may have an effect on buyer utilization ranges.” It’s dangerous to anticipate wanted price restoration over a yr away.

In a earlier submitting, Longview Energy CEO Stephen Nelson advisable to the PSC that Mon Energy and Potomac Edison retain an skilled, exterior advisor, chosen by the PSC, to conduct an intensive overview of their subsequent ENEC submitting, alleging their filings pressure intervenors to “ferret out” the actual points within the case.

Valdes disagreed, saying that might end in an pointless price for his or her prospects. The present testimony has supplied appropriate and enough outcomes to all different concerned events.

Valdes additionally disagreed with Brian Hoyt, Longview’s compliance and environmental supervisor, who stated the businesses bought extra NOx emission allowances than crucial as a result of they did not correctly function and keep the NOx emission controls at Fort Martin. The businesses waited too lengthy earlier than buying the emission allowances they wanted and purchased them at 3 times the value they need to have. Longview advisable disallowing restoration of $42.2 million of extreme 2022 Ozone Season NOx Allowance prices and $18.3 million of 2023 Ozone Season NOx Allowance prices.

Valdes stated the businesses, “when buying allowances through the unprecedented 2022 Ozone NOx market spike selected to take a extra measured strategy to buying our anticipated shortfall for the yr, versus overreacting and buying a big tranche of allowances suddenly.” If energy demand or costs had dropped considerably over 2022, then Mon Energy would have incurred pointless prices for its prospects.

The businesses had beforehand been criticized for failure to keep up correct gas provides at their two coal-fired vegetation, which allegedly led to greater charges. Additionally, in a current submitting, Chelsea Hotaling testifying on behalf of a coalition of the West Virginia Residents Motion Group, Photo voltaic United Neighbors and Vitality Environment friendly West Virginia, stated the vegetation keep coal stock above their security ranges.

On that subject, Mon Energy And Potomac Edison consultant Mark Valach did agree with some PSC Client Advocate Division suggestions about managing coal inventories.

One, they agree with the proposal to develop a plan to handle off-site inventories. Storing coal off website in 2023 was pushed by the concept of buying coal at a below-market worth to make use of in 2024. Their 2024 plan incorporates utilizing that off-site coal, and they’re going to analyze the fee to prospects of holding coal on-site versus potential provide challenges.

In addition they agree, Valach stated, with CAD’s suggestion to formalize a coal procurement process, and can develop a proper coal procurement guide. Their technique of shopping for sure percentages of forecasted coal wants over a three-year interval permits for leveling of short-term variations within the coal market. They overview the technique yearly.

The businesses have two different rate-hike circumstances pending earlier than the PSC.

One is their base fee hike request: $207.5 million for infrastructure and for his or her power help program. The hike would price the typical residential buyer $18.07 per 30 days — elevating a invoice from $120.20 to $138.27.

The opposite is to fund their Vegetation Administration Program. It proposes a rise of $16,969,398 to take impact Jan. 1, 2024, and $16,989,110 to take impact Jan. 1, 2025 — for a complete of $33,938,795.

They are saying this displays an general 1% improve aggregated towards all their buyer lessons. For the typical residential buyer utilizing 1,000 kilowatt hours per 30 days, they venture a hike of $2.47 per 30 days, elevating the invoice from $120.20 to $120.67.

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