The Times West Virginian

Business

February 2, 2014

Study shows state residents spent slightly more in 2013

FAIRMONT — According to a study by the Consumer Advocate Division of the Public Service Commission of West Virginia, state consumers on average spent more money on their utility bills during 2013.

“The Consumer Advocate Division is a physically and fiscally independent division of the commission whose purpose is to represent the interest of residential customers of West Virginia utilities,” said Jackie Roberts, who became director of the division in October.

“This office works very hard ... to do everything we can to protect the interest of residential customers.”

The division recently released its 2014 annual report and comparative residential utility rate study.

“What we focus on in the report are the West Virginia utility rates and how they compare with each other city by city, and how they compare with out-of-state rates,” Roberts said.

The staff works with the various utilities included in the report to find out their rate information, she said.

Each year, the division conducts a survey of 17 cities in West Virginia to find out their electricity, gas, water and telephone rates, and keeps a comparison of which cities are higher and lower in the state and how selected cities have changed over time.

The report also puts the rates of West Virginia's cities up against cities from surrounding states, like Columbus, Ohio, Pittsburgh, Pa., Baltimore, Md., Richmond, Va., and Lexington, Ky.

The utility rates are calculated based on the average usage of residential consumers per month, including 1,000 kilowatt hours of electricity, 13,000 cubic feet of gas, and 4,500 gallons of water. In terms of telephone, the Consumer Advocate Division determines the average flat-rate service for a single line.

The recent report shows that the total utility bills for households in West Virginia went up by 1.2 percent, going from $277.22 in January 2013 to $280.62 in January 2014.

Roberts explained that while electricity rates declined for all companies and the phone rates remained flat, water and natural gas rates were the primary drivers of the increase. Hope Gas was the exception, as its natural gas rates decreased.

From 2010 to 2014, the state’s electricity rates have gone up by 7 percent, water rates have risen by 18 percent, and natural gas rates have seen an 18 percent decline. Telephone rates have stayed the same. Overall, the four-year period represents a 5 percent drop in utility rates.

Roberts pointed out that natural gas prices have actually declined since 2008 and 2009. So while the rates have gone up in the past year, they’re still much lower than they were several years ago.

In 2008 and 2009, coal prices soared and electricity rates have almost doubled since then. Electricity rates are now beginning to stabilize, and a slight decrease is evident from 2013 to 2014, she said.

In January 2014, the city of Morgantown was found to have the cheapest utility rates of the 17 selected cities in West Virginia, at $258.82 per month. Bluefield residents are paying the highest rates, at $316.25.

Fairmont's average came out to $285.75, which includes $92.62 for electricity, $121.16 for gas, $44.35 for water and $27.62 for telephone. Fairmont saw an overall decline of 0.8 percent compared to a year ago.

The report found that the utility rates for West Virginia residents are typically lower — 11 percent on average — than cities in surrounding states. West Virginia’s average rate for all utilities was $280.62 a month, compared to the average of $314.33 for the five out-of-state cities that the study examined.

In terms of the cities studied in surrounding states, the costs were $285.79 for Lexington, Ky., $302.49 in Columbus, Ohio, $311.88 in Richmond, Va., $328.54 in Baltimore, Md., and $342.94 in Pittsburgh, Pa.

In a year from now, Roberts expects telephone rates to continue to stay stable.

Overall, the big driver for the state's rising water rates has been West Virginia American Water. However, the company can't file for another rate increase until 2015, she said.

“I think that with exceptionally cold weather this winter, our electric rates may come down slightly because of the ability to sell our excess electricity to others that need it during these cold temperatures,” Roberts said.

Natural gas prices are now up because of the strain put on the system for natural gas to heat residential homes, she said. However, it’s hard to predict how this period of in time at the beginning of the year will affect all of 2014.

Email Jessica Borders at jborders@timeswv.com or follow her on Twitter @JBordersTWV.

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