Allegheny Power will continue to serve approximately 83,000 customers in all or parts of 14 counties in the northwestern portion of Virginia, as a distribution company only. Allegheny Energy Supply will operate in the competitive retail and wholesale electric supply market. Virginia customers of Allegheny Power will see changes in their monthly electric bills as a result of agreements reached between the company, the public utilities staff of the SCC, and the Attorney General's Division of Consumer Counsel. The combined effect means the monthly bill goes up 86 cents. The rate changes will start appearing on bills that are delivered after August 7, 2000.
Customers receive several benefits from the agreement.
Allegheny Power gives up its opportunity to seek a rate increase before the end of the year. That means the rates being established by the agreement are capped perhaps until July 2007. The company is also abandoning the way it has recovered fuel expenses since the mid-1970s. The fuel factor is being eliminated. Now, Allegheny Power is assuming the risk that it can recover its fuel expenses under the settlement's rate cap during this period of transition to a competitive energy supply market.