Testimony ends in Mitchell Plant hearing
CHARLESTON — Evidentiary hearings on a request that could determine the future of the Mitchell Power Plant in Marshall County wrapped up Wednesday after two days of testimony.
The Public Service Commission heard testimony and cross-examinations Wednesday of experts on behalf of groups for and against a request by Appalachian Power Company and Wheeling Power Company for the PSC to approve improvements to Mitchell and other power plants in the state.
The companies are seeking certificates of public convenience and necessity from the PSC as well as a 1.5% rate increase on electric consumers to fund the needed environmental improvements to Mitchell, the Amos Plant in Putnam County, and the Mountaineer Plant in Mason County.
The improvements will bring the power plants in line with federal rules for wastewater and handling coal ash. The finalized coal ash rules require the companies to inform the state Department of Environmental Protection by Oct. 13 whether they intend to retire Mitchell. The PSC’s pending decision on the companies’ certificate will determine whether Mitchell stays open past 2028.
Steve Baron, the president and principal of Georgia-based J. Kennedy and Associates, testified Wednesday morning on behalf of the West Virginia Energy Users Group. The group represents large manufacturers and industries opposed to increases in electrical rates.
Baron believes the commission should forgo any approval of effluent limitation guidelines (ELG) rate recovery of Mitchell expenditures. ELGs deal with wastewater generated by coal-fired power plants, which limits how much arsenic, mercury, selenium, and other pollutants can dump into the water.
“There is a substantial amount of dollars being requested by the company in surcharges or rider proposals that could otherwise be recovered, and be more appropriately recovered, through a base rate proceeding, where everything is being examined,” Baron said.
“Your opinion is the company should be filing a base-rate case because that’s the way it’s always been done,” asked Charlotte Lane, chairwoman of the PSC.
“That’s one element of it, but the main reason for filing a base rate case is that it allows the commission, the staff, and the parties to fully examine the reasonableness of the company’s revenue requirements and rates,” Baron responded.
The companies are considering either a $317 million plan to keep all three power plants open up to 2040, including Mitchell; or a $286 million plan that would keep the Amos and Mountaineer plants open, but wind down Mitchell by 2028.
The rate increases would raise more than $23 million from slightly differing rates, with residential customers seeing a 1.59% increase, commercial customers seeing a 1.52% increase, and industrial customers seeing a 1.72% increase.
Todd Myers, the principal at Colorado-based Leviathan Advising on behalf of the West Virginia Coal Association, presented testimony making the case that closing the Mitchell Power Plant would have negative effects on the power grid. Myers concluded that the value of Mitchell will increase as other power plants are shut down and as the demand for electric vehicles grows.
“That value is likely to increase over time as other baseload coal-fired power plants retire in the PJM and adjoining power markets,” Myers summarized in his findings. “There is also the realistic potential for substantially stronger growth than assumed in the companies’ load demand forecasts due to political and industry momentum to rapidly electrify the transportation sector and other sectors of the economy.”
During questioning by Lane, Myers elaborated further on his concerns about the PSC possibly rejecting the Appalachian Power/Wheeling Power request.
“I’m advocating that the commission consider the risk of closing an existing coal plant … and consider it in the context of risk,” Myers said. “What I recommended was maintaining the Mitchell station as less risky.”
A decision on the companies’ request will be made at a later date.