RICHMOND, Va. – A ruling by the State Corporation Commission (SCC) will reduce energy rates for customers of Dominion Energy Virginia and Appalachian Power Company on April 1, 2019.
The rates reduction is part of a directive of the Commission issued in January 2018 that ensures customers receive the benefits of the corporate tax cut contained in federal tax legislation passed by Congress in December 2017, according to officials.
Each company will also provide a one-time credit to customers to account for the difference in rates between January 1, 2018, effective date of the Federal tax reduction and March 31, 2019, the last day of interim rates.
The federal corporate income tax rate was reduced from 35% to 21% effective January 1, 2018. This reduction was followed by the SCC ordering companies to preserve the savings from this tax cut to benefit customers.
Dominion Energy reduced rates by $125 million, on an interim basis subject to further Commission review. Appalachian Power reduced rates by $50 million last July, also subject to further review, according to the SCC.
Both Dominion Energy and Appalachian Power submitted additional filings with the Commission to make certain the tax savings are properly calculated and reflected in base rates as of April 1, 2019.
Dominion Energy’s base rates are being reduced by $182.5 million, or $57.5 million more than the interim rate reduction last July. Appalachian Power’s base rates are being reduced by $80.1 million, or $30.1 million more than last July.
“The April 1 rate reduction might be around 55 cents/month, said SCC director Ken Schrad. “The July 1, 2018 reduction was around $2.60/month.”
So, how much money could customers get back in their Dominion bills?
“Hard to calculate with certainty because some of the reduction occurred July 1, 2018 and the rest occurs April 1,” said Schrad. “For Dominion, a very rough estimate of the one-time credit for the mythical residential customer using exactly 1,000 kWh/month may be $20-25 that will appear on a customer’s bill prior to July 1.”
Appalachian Power Company must provide the one-time credit by October 1, 2019.
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