trending Market Intelligence /marketintelligence/en/news-insights/trending/zae3j_by88yx9aijwynn4w2 content esgSubNav
In This List

W.Va. regulators reject Appalachian Power wind farm deal

Podcast

Next in Tech | Episode 49: Carbon reduction in cloud

Blog

Using ESG Analysis to Support a Sustainable Future

Research

US utility commissioners: Who they are and how they impact regulation

Blog

Q&A: Datacenters: Energy Hogs or Sustainability Helpers?


W.Va. regulators reject Appalachian Power wind farm deal

The Public Service Commission of West Virginia has joined with Virginia regulators in rejecting Appalachian Power Co.'s plan to buy two wind farms from Chicago developer Invenergy LLC.

The PSC found in its May 30 order that the American Electric Power Co. Inc. utility's proposed acquisitions of the planned 175-MW Hardin County Wind Farm in Ohio and the planned 50-MW Beech Ridge II Wind Project in Greenbrier County, W.Va., "are not in the public interest in West Virginia."

"We are not indifferent to the increasing public concern about the relative increase in electric rates," the PSC wrote in its order. "As a consequence, we are not inclined to lock-in [25] years of base rate costs for power supply that is just as likely to cost more than the market alternative as it is likely to cost less than the market alternative based on speculation that some future customer might want green power that is owned, rather than purchased, by the companies."

Regulators cited a variety of other factors in their order as well, including the fact that the required Virginia State Corporation Commission, or SCC, approval was denied.

The SCC on April 2 denied Appalachian Power's request to acquire the 225 MW of wind generation and recover costs from ratepayers because the utility did not show the need for the energy and capacity.

West Virginia regulators also cited the lack of need for the additional capacity and the "availability of ample energy supplies" from the PJM Interconnection market.

In addition, the West Virginia PSC said there is a real possibility that the revenue requirements for the wind facilities would not be shared between West Virginia and Virginia given the SCC's rejection of the deal. These revenue requirements are expected to increase after the first 10 years.

"The base rate revenue requirement over the entire [25-year] life of the wind facilities, without the costs being allocated between West Virginia and Virginia, would total $839.6 million," the PSC wrote in its order.

Appalachian Power in July 2017 proposed purchasing the wind farms to diversify its portfolio and help its "transition to an energy company of the future." (PSC docket 17-0894-E-PC)