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Supreme Court denies Citizens Action Group's appeal of power station deal

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The West Virginia Citizens Action Group lost its bid to prevent Mon Power from buying a power station in Harrison County and passing much of the cost on to consumers in the form of higher rates.

This week, the state Supreme Court of Appeals affirmed a PSC decision approving the deal and granting Mon Power a $257 million acquisition adjustment. An acquisition adjustment is the difference between the original net cost of the plant and the amount the purchaser, in this case Mon Power, actually paid for it.

The company originally sought a $598 million adjustment, but that came under fire from a host of consumer groups, including the Consumer Advocate Division of West Virginia, West Virginia Citizen Action Group, the West Virginia Energy Users Group, Utility Workers of American, AFL-CIO and Local 304, the Sierra Club, the Independent Oil and Gas Association of West Virginia; IBEW Local 2357, AFL-CIO; and the West Virginia State Building & Trades Council.

All but WVCAG stipulated to the reduced $257 million pass-back, which also included a package of incentives the court said was designed to increase employment, lend economic development support to industry, assist low-income customers, promote energy efficiency in schools, support renewable energy, support lower rates and expand funding for energy efficiency programs.

WVCAG had appealed the decision on the grounds that it wasn't in the best interests of the state’s utility consumers or Mon Power; it wasn't necessary to solve the shortage in Mon Power's capacity to produce energy, and saddled the company with significant excess in energy for well over the next decade. They also disputed the commission's finding that purchasing the Harrison plant would be the “least expensive alternative.”

“The petitioner has failed to convince this court that the commission's findings are contrary to the evidence, without evidence to support them, arbitrary, or that the commission's application of the law is inconsistent with commission precedent,” the court wrote. “As a result...we find no reason to disturb the commission's order.”

WVCAG, meanwhile, voiced its disappointment with the decision, saying it will “lead to unnecessary, long-term expense and risk to West Virginia’s families and businesses.”

“Mon Power and Potomac Edison ratepayers will now have to pay an artificially inflated price for the Harrison Plant, solely benefiting FirstEnergy, the Ohio-based parent of these West Virginia utilities,” the group states. “West Virginians will now pay this additional $257 million premium that dissenting PSC Commissioner Ryan Palmer referred to as a "text book write-up" in the value of the plant.”

“WV Citizen Action Group will continue to fight for West Virginia's families and businesses to save money by increasing state energy efficiency programs and by working to prevent out-of-state utilities from continuing to dump their old, expensive power plants like the Harrison and Mitchell plants onto the monthly utility bills of West Virginia consumers.”