PSC: Mitchell Plant Can Stay Operational Until At Least 2040
Following an order Tuesday from the West Virginia Public Service Commission, the lights can stay on at Marshall County’s Mitchell Power Plant for years to come.
The PSC ordered that Appalachian Power and Wheeling Power can make the improvements necessary at three of its West Virginia power plants — Mitchell, Mountaineer in Letart and Amos in Winfield — so they can remain open until at least 2040. The improvements would keep all three plants in compliance with new environmental guidelines.
Previous options would have allowed the Mitchell Plant only to make improvements that would allow it to stay operational until 2028. The future of the three plants also took a hit was imperiled when the Virginia State Corporation Commission and the Kentucky Public Service Commission, which owns a 50% stake in the Mitchell Plant, denied requests from Appalachian Power and Wheeling Power to make the improvements that would keep the plants open until 2040.
“Prematurely retiring the Plants at least twelve years prior to the current estimated retirement year of 2040, continuing to require ratepayers to pay for the capital costs on the stranded investment created by prematurely retiring the Plants and, adding to that the capital costs between $1.9 and $2.3 billion in capacity costs to replace the plants that could have continued to operate is not a decision that is supported by the evidence,” the PSC wrote in its order.
In the order, the PSC said that, since Kentucky and Virginia refused to chip in for the cost of the upgrades, the two states will not be permitted to use the capacity or the energy provided by the three plants.
The PSC’s decision will not immediately affect power bills for West Virginia customers, the PSC said, but Appalachian Power and Wheeling Power are seeking rate increases to cover the costs of the improvements. In September, the companies said they were seeking a 3.3% increase, up from 1.6% that the PSC had approved in August.
The PSC’s order pointed out the benefits of keeping all three plants open, including the use of West Virginia coal, direct employment at the plants, and taxes related to operating the plants, among others.
Tuesday’s order brought both praise and derision. Several elected officials lobbied for the Mitchell Plant to stay operational until 2040, saying that closing the doors early would be devastating to the economy of Marshall County and the Ohio Valley. Del. Lisa Zukoff, D-Marshall, was one of those officials. Reached Tuesday night, she said the Mitchell Plant remaining open was a positive for the region.
“I’m excited for the jobs we’re going to keep in our valley,” she said. “Not just for the power plant, but for the coal jobs that we have from the mines. Marshall County is the highest-producing coal county in the state of West Virginia, and we need those jobs. And there are a lot of construction jobs supported there.”
She added that she was disappointed that West Virginia consumers will at some point see higher power bills, especially those with fixed incomes. Several groups released statements Tuesday excoriating the PSC for their decision because of that rise in rates.
Energy Efficient West Virginia called the decision “outrageous.”
“The Public Service Commission is, by law, required to balance the interests of ratepayers and utilities, with an eye to what’s good for the overall economy in the state,” the statement read. “What we got with this decision is what is overwhelmingly good for utilities at the expense of their customers, and benefitting one slice of our economy to the detriment of everyone else.”
AARP West Virginia also said it was disappointed in the ruling, mentioning that most of the public comments from industrial and residential ratepayers were against the rate increase.
“Thanks to the swift action of the Commission, American Electric Power will recoup its half-billion investment solely on the backs of West Virginia ratepayers, who will continue to export power they’re paying to produce to other states while seeing their own utility bills escalate for the foreseeable future,” AARP West Virginia’s statement read.
Zukoff said that the Mitchell Plant remaining open should help bolster county coffers in several ways.
“We don’t stop to think about the taxes the plant pays to our county and the revenue it brings into our county from that perspective,” Zukoff said. “And if we didn’t have that money, there might be some services that we’d lose. In the long run, I think this is a win-win for everyone, even though it might not seem like that to the consumer at the time.”