Virginia Electric and Power Co., which has raised its residential electric rates by about 20 percent in the past year, said yesterday that it soon will seek permission in increase the charges by approximately 5.8 percent.
Spokesmen for the Richmond-based utility said the precise amount of the increase, which would affect most homes and business in the Virginia suburbs, will not be known for several weeks.
But in its annual financial review filed with the State Corporation Commission, the company said its revenues this year will fall at least $64 million short of its authorized rate of return unless it is granted an increase. Vepco spokeswoman Sarah Demarest said the company will file a formal application for an increase in approximately that amount "in the very near future."
"The final figure could be a little higher or lower depending on adjustments," Demarest said. "You can expect to see us file [for an increase] within the next couple of weeks."
In recent years, the SCC has granted Vepco between 50 and 60 percent of the increase it has sought in any rate case. The most recent award in March granted the utility $148 million a year and came after the company asked for increases amounting to $246 million.
Demarest and other Vepco spokesmen predicted the proposed rate hike would be balanced by increased annual fuel savings of $64.1 million when its North Anna No. 2 nuclear plant opens sometime later this year. "We expect the net effect on customers' bills to be zero," Demarest said.
Diane Worthington, chairman of the Virginia Consumers Congress, a collection of state consumer groups that traditionally appears at SCC hearings to oppose rate increases, said she was skeptical of the company's claim.
"I assume they'll save money, provided they can keep North Anna open," said Worthington. "But looking at what's happened in the past, that's a pretty tough assumption to make."
Vepco has had difficulty keeping its three nuclear units in operation. The latest shutdown came in March, when the Nuclear Regulatory Commission ordered Vepco's two Surry units closed to determine whether their cooling pipes could withstand a major earthquake. No date has been set for their reopening.
The company has estimated that the Surry shutdown is costing $375,000-a-day in additional costs for oil and coal to replace cheaper nuclear fuel. It said yesterday it will seek an as yet undetermined increase in the amount it charges its estimated one million customers for fuel in a separate SCC hearing scheduled to begin June 19.
In its annual review filed yesterday, the company attributed $46 million of its shortfall to expenses to be incurred when the North Anna No. 2 unit begins operation, and another $18 million to unspecified costs.
The company said the shortfall lowered its rate of return on its facilities to 8.88 percent, well below the 9.6 percent rate authorized by the SCC when it approved Vepco's last increase in March.
At that time, the company conceded that its customers would be paying among the highest electric rates on the East Coast. Vepco President Stanley P. Ragone said then that the increase wasn't enough and warned the company would be returning to the SCC for another rate review within a few months.
Worthington said she was outraged that the company would again ask for higher rates. "We felt they got more than they needed last time," she said. "You'd think they'd give us more time to adjust to the last increase before trying to get another one."