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Most W.Va. residents saw lower utility bills in 2012, report says

By Megan Workman

CHARLESTON, W.Va. -- Most West Virginians saw the total cost of their utility bills -- gas, water, electricity and telephone services -- decrease last year, according to a report released Wednesday.

Electricity rates declined or remained stable for the first time in five years. Natural gas rates continued to drop.

Residential customers' combined utility rates decreased by 5.3 percent statewide in 2012, following a 2 percent increase in 2011, according to the report.

The average West Virginian is now paying about $15 less per month for utility services. In January 2012, people paid $292.81 for electricity, gas, water, and telephone service. This month, those customers are paying $277.22 for the same utility services, according to the study.

Byron Harris, director of state Public Service Commission's Consumer Advocate Division, which issued the report, said much of the utility rate decrease is a result of electricity rates not changing for Appalachian Power customers, while Monongahela Power's rate went down. The PSC ordered Monongahela Power to reduce its rates by $65.7 million in December.

This, combined with the low natural gas prices, supported the decrease, he said.

However, Harris stressed that this report is "just a snapshot of rates as of January 2013."

"For both Appalachian Power and Wheeling Power, AEP's companies, and Monongahela Power and the Potomac Edison Company, they have petitions before the Public Service Commission to acquire over $1 billion of electric-generating facilities," Harris said. "Those impacts don't show up in the rate survey and they are going to have significant impact on West Virginians."

Although electric rates remain unchanged or have decreased -- after several years of increases -- Harris said the future of electricity rates are "far more uncertain and face a lot of pressures."

While low natural gas prices are good for natural gas customers, they aren't good for people who heat their homes with electricity, Harris said.

Also, the PSC's decision about whether the electric companies should be allowed to acquire the power plants will "have a significant impact on electric utility rates," he said. Those cases should start in the summer, Harris said.

Unregulated affiliate companies, one of which is Allegheny Energy Supply Co., currently own those plants.

The electric companies say the plant purchases could help them provide cheaper services to customers.

Finally, coal prices and more restrictive environmental regulations play a role, Harris said.

Natural gas prices, however, continued to decline primarily because of the impact of the global economic recession on wellhead gas prices, the report stated.

From 2000 through 2008, natural gas rates more than doubled, reaching a peak in January 2009 when an average natural gas bill was almost $200 a month.

Today, an average West Virginian's bill is 41 percent cheaper -- at $116.24 -- than in 2009.

"I hope they use that extra money to try to continue to save energy in their homes because ... the future looks fairly bright for natural gas," Harris said.

The report also found that Logan residents pay the lowest overall utility rates, at $262.67 a month, while Bluefield customers have the highest bills, $295.66 a month. That's a 12.5 percent difference.

Charleston and Huntington customers paid $287.98 a month for all utilities, $10 more than the state average.

The report also concluded that West Virginians living in the state's 17 largest cities have lower rates than customers in Pittsburgh, Baltimore, and Richmond, Va.

Yet all West Virginia customers have higher rates than customers in Lexington, Ky., at $234.32 a month, and four cities in the state have higher rates than Columbus, Ohio, at $272.40 a month.

The state's average rates for natural gas, telephone and water service were higher than in surrounding states.

The high cost of water services provided by West Virginia American Water -- the largest water utility in the state -- is an "ongoing concern," the report stated.

In December, West Virginia American Water filed for a $24.1 million revenue increase, which would increase an average customer's monthly bill by about 21 percent.

"Since [West Virginia American Water]'s rates are already the highest in West Virginia, the companies' increase request will make water service even less affordable for many of the 171,000 customers it serves," the report stated.

Customers using exactly the same amount of water -- 4,500 gallons -- paid as little as $17.42 a month in Morgantown, or as much as $50.50 if they were served by West Virginia American Water, according to the report.

Statewide since 2008, water bills have increased by 35.5 percent. During the same time period, electricity bills have increased by more than 38 percent while natural gas prices have decreased nearly 30 percent.

Reach Megan Workman at megan.workman@wvgazette.com or 304-348-5113.


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