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Appalachian Power files cost recovery request for environmental improvements

Appalachian Power has requested permission to recover costs associated with meeting environmental regulations at its generating plants that serve Virginia customers, including rules relating to the ash handling and wastewater discharge systems at the John Amos and Mountaineer plants.

In a filing with the Virginia State Corporation Commission (SCC), Appalachian Power requested cost recovery for those environmental improvements through an Environmental Rate Adjustment Clause. If approved by the SCC, residential customers using 1,000 kWh/month are expected to see a $2.50 monthly increase beginning in October 2021.

The total investment at the two plants is approximately $250 million.

“This investment in our existing coal plants is all about balance,” said Chris Beam, Appalachian Power president and COO. “While we are planning investments in renewables in both Virginia and West Virginia, consistent with state legislation, we also need to invest in these plants because they will continue to play an important role in maintaining affordability and reliability for our customers.”

Today’s filing is the first step in obtaining the regulatory approvals necessary to implement the compliance plans the company filed last month with the U.S. Environmental Protection Agency to meet its Coal Combustion Residuals (CCR) and Effluent Limitation Guidelines (ELG) rules.

The company’s request includes cost recovery for upgrades to bottom ash handling systems and wastewater treatment facilities to comply with the CCR rule and the ELG rule at Amos and Mountaineer plants. Existing ash ponds at the plants will close and the ash will be moved to regulated landfills. Amos is a 2,930 MW plant in Winfield, W.Va., and Mountaineer is a 1,330 MW plant in New Haven, W.Va.

“For each plant, we analyzed the most cost-effective way to meet customers’ energy needs,” Beam said. “We looked at the level of investment needed to comply with the rules, remaining operating life of the plant and potential future compliance costs.”

In addition, the company is also requesting to recover other costs that it has incurred and will incur that are necessary to comply with state or federal environmental laws or regulations applicable to the company’s generation facilities.

While the company makes these environmental investments, it is transitioning to a carbon-free future. Under the Virginia Clean Economy Act, Appalachian will transition its Virginia customers to 100 percent carbon-free generation by 2050, primarily from wind and solar generators.

Appalachian Power has 1 million customers in Virginia, West Virginia and Tennessee (as AEP Appalachian Power). It is part of American Electric Power, which is focused on building a smarter energy infrastructure and delivering new technologies and custom energy solutions. AEP’s approximately 17,400 employees operate and maintain the nation’s largest electricity transmission system and more than 221,000 miles of distribution lines to efficiently deliver safe, reliable power to nearly 5.4 million customers in 11 states. AEP is also one of the nation’s largest electricity producers with approximately 31,000 megawatts of diverse generating capacity, including 5,200 megawatts of renewable energy.

 

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