Old Dominion Power raises rates on Southwest Virginians amid economic crisis

The Virginia State Corporation Commission has approved a rate increase request from Old Dominion Power, which will add about $20 to average residential monthly bills in its Southwest Virginia service effective May 1.

The move came despite a plea from the region’s state legislators that the commission consider the record unemployment numbers and economic downturn in its decision. The rate increase will boost the utility’s operating revenues by $9 million, less than the utility’s initial request of $12.7 million, but coming at a time when families, local governments and businesses in ODP’s service area are struggling amidst the Covid-related economic crisis. 

“The timing of this increase could not be worse, and we encourage the commission and lawmakers to continue to seek ways to help Southwest Virginia communities lower their energy bills,” said Chelsea Barnes, New Economy Program Manager with Appalachian Voices, an intervenor in the ODP rate case.

“Once again, the corporation wins out over the needs of the people. It seems unconscionable that during this time of pandemic and massive job loss this increase is allowed,” said Laura Miller from Wise and an ODP customer, and member of Southern Appalachian Mountain Stewards.

>> See additional community quotes below

Appalachian Voices convinced the commission to reject changes to rate designs that would have affected residential and commercial customers, and negatively impacted the economic viability of solar and energy efficiency. ODP had recommended increasing the residential monthly Basic Service Charge from $12 to $16.13, but the SCC said no. The higher fixed charges would have made it more difficult for customers to lower their electricity bills by lowering their electric usage through efficiency, solar installations or behavioral changes. The commission also rejected ODP’s proposed changes to the structure of rates for commercial and industrial customers that were similarly harmful to solar and energy efficiency efforts.

“We’re glad the commission rejected the rate changes that would have put up additional barriers to solar energy development and energy efficiency improvements that are much needed in Southwest Virginia,” said Barnes.

ODP serves nearly 30,000 customers in the City of Norton and Wise, Lee, Russell, Scott and Dickenson counties of Virginia, an area where between 17.6 percent and 28.2 percent of residents live in poverty as defined by the federal government. The company powers 99 percent of its operations with fossil fuels, and currently offers no energy efficiency programs to its Virginia customers.

As the Covid pandemic continues to spread, many states have implemented bans on utility shutoffs to protect customers from losing power during this crisis, including Virginia. On March 16, the SCC issued an order prohibiting regulated utilities, including ODP, from terminating electric service for 60 days. ODP also states on its website that it will waive new late fees incurred during the crisis.

A letter submitted to the commission by Southwest Virginia legislators Delegate Terry Kilgore, Delegate William Wampler, Senator Todd Pillion and Senator Ben Chafin on March 31 noted that “COVID-19 has caused a record number of Virginians to file for unemployment. Additionally, government mandated closures have also contributed to the loss of revenue for numerous businesses in our area… we ask that the State Corporation Commission seriously consider the adverse effects that this proposed increase will have on families, businesses, and public/private institutions.” 

“Old Dominion Power customers are often ignored by state lawmakers and regulators,” Barnes said. “Though the people of Southwest Virginia will benefit from the temporary halt in utility shutoffs and late fees, our state leadership must take more care to address the energy burden facing the region and prevent future rate increase shocks”.

More Southwest Virginians will face electricity rate increases in the near future as Appalachian Power filed a rate case on March 31, requesting a 5% increase to be effective in 2021.

Other community members respond: 

“With the largest increase on my power bill ever, I am going to make the shift to solar power. Thanks for the push,” said Akwe Starnes from Big Stone Gap, an ODP customer and member of Southern Appalachian Mountain Stewards, a local organization working to build just and equitable communities in Southwest Virginia.

“Because we are a new business scheduled to open soon in Big Stone Gap, we’re uncertain how the ODP rate increase would affect us. We imagine that the ODP rate increase during this strained economic time could ultimately cause a financial strain on many of our future customers, which in turn could cause a financial strain for our small business,” said Penny Jeffrey, owner of the Big Stone Gap General Store & Cafe, LLC.

“At a time of such crisis, people in rural communities are seeing corporate entities like this take advantage of citizens simply because they know they can. With so many of us required to stay in our homes, we have no choice but to use our personal utilities more often. We inevitably have to use more power for things like work equipment and more water for cleaning to keep our families and our communities safe. While many companies all over the world are trying to help customers out with relaxed policies on missed bills, ODP has made a targeted choice to work against the well-being of human beings by approving and applying this rate increase,” said Rachel Fischer from Norton, also an ODP customer, and member of Southern Appalachian Mountain Stewards. 

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