The State Corporation Commission ordered the Virginia Electric and Power Co. yesterday to prove by March 28 that "utility inefficiencies are not passed on to the rate payer" in higher fuel adjustment charges.
The SCC said there had been significant fluctuations" recently in fuel adjustment charges on consumer bills and it had "noted a growing disparity" between fuel price increases and fuel adjustment increases.
In a press release, the SCC said some residential electric bills had increased 1 to 20 per cent since November and "This large difference has not been due basically to changes in the costs of fuel, but primarily to the type of facilities used to generate the energy."
A Vepco spokesman said both of the company's two nuclear units at Surry on the James River were shut down during much of the last quarter of 1976.
The units experienced a series of mechanical difficulties, including leakeage in steam generator tubes, and also underwent routine maintenance and refueling.
Vepco said it was unable to schedule the shut-downs to keep one unit operating all the time.
The SCC pointed out in an official statement that Vepco is authorized to pass on to customers automatically any increases or deceases in the cost of fuel to run its generators, whether coal, oil or uranium (for nuclear plants.) This is shown on electric bills as the fuel adjustment charge.
Further, the cost of fuel for a coal plant is less than for an oil-run plant and the cost of generation in a nuclear plant is even less, the SCC said.
So, fuel adjustment charges would vary according to which fuel was being used to generate power. The SCC said if nuclear units were shutdown - for whatever reason - fuel charges to customers consequently would increase.
The SCC said it was concerned about cost fluctuations because "the customer can be inconvenienced by a succession of changes" in his bill and because it is possible that Vepco is inefficient.
". . . the fuel adjustment factor will vary depending on . . . the company's maintenance and repair schedule for generating units, particularly for nuclear units," the SCC said.
If company management has an inefficient, ineffective program for repair and maintenance then this unfavorable situation can result" in higher consumer costs.
The SCC asked: does the fuel adjustment clause, as applied by Vepco, "unreasonably remove incentives to efficient operations?"
Vepco issued a statement saying it had complied with SCC regulations and was "recovering only its actual costs" from fuel adjustment charges. It credited the use of nuclear power during the first three quarters of 1976 with saving consumres between $60 million and $90 million in fuel costs.