One of the advantages West Virginia has historically enjoyed when attracting and supporting businesses in the state has been low electric rates.  However, that advantage has been severely challenged over the past four years with rates soaring nearly 50 percent.  If we allow "business as usual" to continue and make no attempt to develop a logical plan to keep electric rates reasonably in check, that advantage will be lost forever.

When electric rates rise, businesses must find a way to cover the increased cost.  That could mean cutting back on staff, resulting in increased job loss throughout the state.  It could also mean that businesses will simply throw in the towel and close altogether.  Or, perhaps they will simply relocate to another state where sensible planning provides electric rate certainty that businesses can rely on.  The ultimate outcome of West Virginia's lack of planning to control skyrocketing electric rates will most likely be a combination of all the above.

The Power Line blog reports today that a "whispering campaign" has been started at the legislature by power company lobbyists who contend that SB162, requiring electric companies to submit least-cost plans to the Public Service Commission, will cause job loss in the state.

The power company's scare tactics are completely untrue, as The Power Line aptly points out.  In fact, the opposite is true.  Failure to institute least-cost planning will lead to wide-spread job loss across all industry and business sectors in the state.

Power company lobbyists say least-cost planning "would result in coal miners losing jobs and the power companies’ coal fired plants closing down."  The coal industry may be in trouble, but it has nothing to do with least-cost planning in West Virginia.  The price of coal has gone up due to an increase in exports to other countries who will pay dearly for it.  In contrast, there has been a corresponding decrease in gas prices due to excess production.  The gas vs. coal electricity generation war has begun.  West Virginia's electric consumers have absolutely no fault in this and cannot solve it by paying more for electricity.  It's an economic problem we can't afford to straighten out.  Electric consumers don't have a dog in this fight.

Adding to the dilemma is decreased electric demand related to energy efficiency and demand response occurring in east coast states.  West Virginia exports 80% of the electricity generated in the state to east coast markets.  When the east coast isn't buying it, and is in fact building new gas-fired generation to meet their own needs, it causes electric rate increases here in West Virginia because power company sales to the east coast are part of what has kept our rates low in the past.  This fact is also beyond the control of West Virginia electric consumers.

As well, there's an incredible amount of waste going on at West Virginia's electric utilities that has nothing to do with fuel costs.  For instance, did you know that AEP's former CEO was allowed free use of the corporate jet for personal travel as part of his employment contract?  There's certainly plenty of belt-tightening that can be done at the corporate level before placing their economic woes at the doorstep of West Virginia's electric consumers.

The power company lobbyists are lying to your elected representatives.  The legislators who continue to stall SB162 are choosing to throw their constituents under the bus, and are embarking on a very slippery slope which will endanger the prosperity of West Virginia business and industry.

Look no further than Ohio for a recent example of what can happen when huge electric rate increases, cooked up through a corrupted Public Utilities Commission process, hurt business

West Virginia can, and must, do better by instituting least-cost planning.


06/19/2012 7:56am

Nice blog about the job market. I really appreciate the blog writing. Thanks for the wonderful post.

10/11/2013 10:45am

I like your post businesses in the state has been low electric rates. This blog is contain good information for the worker of West Virginia Electric Rate Increases Will Cause Job Loss.


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