West Virginia Senate Bill SB564

West Virginia 2023 Regular Session

• Introduced: 2/6/23
• Refer: 2/6/23

Caption

Allowing PSC to authorize recovery of certain costs by utilities through issuance of consumer rate relief bonds

Impact

The passage of SB 564 would amend the West Virginia Code to formally include criteria and processes by which utilities can seek recovery for specific eligible costs using consumer rate relief bonds. This change would facilitate a more streamlined process for utilities to manage fluctuations in costs, potentially leading to more stable rates for consumers. However, it also places significant power in the hands of the PSC to determine which costs are appropriate for recovery and how these costs will be allocated to consumers through rate adjustments.

Summary

Senate Bill 564 introduces provisions allowing the Public Service Commission (PSC) of West Virginia to authorize the recovery of certain costs incurred by electric utilities through the issuance of consumer rate relief bonds. This bill is designed to provide a mechanism for utilities to mitigate the financial impact on consumers from fluctuating costs associated with energy production, including storm recovery and environmental control costs. By allowing the securitization of these costs, the PSC can provide a more straightforward financial recovery process for utilities while aiming to protect consumer interests.

Sentiment

The sentiment surrounding SB 564 appears to be cautiously optimistic among proponents, particularly those in the utilities sector who argue that the bill will provide necessary flexibility in the face of rising operational costs. However, there are concerns from consumer advocacy groups and some lawmakers about the implications of such financing on consumers' monthly bills and the potential for increased rates over time. The debate reflects a balancing act between ensuring utility stability and protecting consumer financial interests.

Contention

One notable point of contention regarding SB 564 revolves around the extent of PSC's authority in approving consumer rate relief bonds and the transparency of the process. Critics express fear that this bill may lead to a scenario where utilities could impose additional charges without sufficient oversight, potentially leading to higher costs for consumers. Moreover, concerns exist about the long-term consequences of allowing utilities to securitize costs that could otherwise be absorbed without consumer rate impacts.