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... and checking it twice.  Gonna find out who's... ut-oh, AEP, you've been naughty this year!

I take back my snarky comments about this reporter after his silly "evil twin" story about new AEP CEO Little Drummer Boy. Dan Gearino of The Columbus Dispatch actually did some investigative journalism about AEP's sneaky rate hike deal with Ohio's Public Utilities Commission.  The deal could raise electric rates for small businesses by more than 30%, while lowering rates for big, industrial energy hogs.  Check out the results of the reporter's investigation here.

AEP is going to raise the electric rates of Kentucky Power customers 31% to installer scrubbers on their Big Sandy plant so that it can continue to burn lots of MTR coal far into the future instead of switching fuel sources.  Keep in mind that the power companies always ask for more than double the rate increase they actually need because they know the state utilities commission is going to hack it up until it resembles something just and reasonable.  Could AEP be padding the cost of this upgrade to support Mikey's EPA "train wreck" fantasy?  I hope the Kentucky utilities commission checks AEP's claim that installing the scrubber is truly the least cost option over the long term instead of switching fuels, or other options.

If you're an Appalachian Power customer in Virginia, you can now start giving those Santa suit clad bell ringers the hand on your way into Wal-Mart because the Virginia SCC has now made AEP your charitable contributions coordinator.  In a split decision, the SCC has allowed Appalachian Power to recover the cost of their charitable contributions from their customers.  Dissenting Commissioner Mark Christie gets it right when he says recovery of charitable contributions have no place in a monopoly franchise.  The company can deduct these contributions from their taxes, but they'd much rather recover them from their customers and take credit for the "charity."  Outrageous!


And last, but not least, check out this episode of The Keystone Cops that ensued when Appalachian Power held a storm response drill in West Virginia.  APCO would do better to just spend some of that money they received in rate increases to repair and maintain their crumbling distribution system instead of playing storm games.  Be sure to check out the comments -- hysterical -- AEP will next practice filing for more rate increases!  :-)

Ho Ho Flippin' Ho, AEP!
 


Comments

bh link
12/08/2011 4:56am

The installation of stack scrubbers may actually decrease the amount of MTR coal burned at the Big Sandy plant, as AEP can then burn high sulfur coal in the plant. Back in the 1990s, as sulfur emission standards under the Clean Air Act were tightened, AEP had a choice of two methods in decrease its sulfur emissions. They could pay a little more per ton for low sulfur coal, or they could spend hundreds of millions of dollars to install scrubbers and continue to burn high sulfur coal.

The Clean Air Act also prevented power companies from adding scrubbers to its oldest coal burners, because companies like AEP had promised Congress that these plants would be closed by the 1990s. The power companies broke their promise, and the Clinton-Gore administration let them get away with it, although a lot of northeastern states were screaming at them to enforce the law.

The Cheney administration pushed the Clear Skies Act through Congress that lifted all restrictions on the plants that were supposed to have closed, which allowed power companies to install new scrubber systems on them, keeping their 50 and 60 year old coal burners alive for coming decades.

So, back to MTR -- MTR really kicked into gear in the 1990s, because most of the thin seam coal that is mined that way is very low in sulfur. It was perfect for the power companies' plan to meet Clean Air Act standards by burning low sulfur coal.

Now, three things are happening that are pushing AEP toward installing scrubbers and reducing purchases of low sulfur coal -- the Cheney law changes that allow new investments in the oldest power plants, steadily rising prices for coal, and increasing public pressure to restrict MTR mining. Now power companies are increasingly opting to install scrubbers and go back to burning high sulfur coal. AEP is actually reopening a lot of its own captive mines (closed in the 1990s) that produce high sulfur coal to feed their power plants again.

All of this is to say that installing scrubbers may actually reduce the burning of MTR coal. The problem is that burning high sulfur coal and removing pollutants from stack exhaust creates massive new problems of disposing of the hazardous chemicals caught in scrubbers.

Coal is still coal, and it does what coal does. Scrubbers don't make pollution go away, they just change it into another form of pollution.

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bh link
12/08/2011 5:39am

It's great to see AEP's view of the role of electricity rate payers. In VA, they want to force rate payers to support charities of AEP's choice, a sentiment apparently shared by a majority of the VA SCC. In KY, AEP apparently believes that the function of KY rate payers is to provide jobs for the KY coal industry. Of course, it probably won't be the same coal miners, because with Big Sandy's new scrubbers, AEP won't have to buy East KY's higher priced low sulfur coal, but can start burning lower priced coal mined in western KY.

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Da Hillbilly
12/09/2011 2:35am

AEP ... the ONLY actually hoping to get coal in their stockings this year!

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