West Virginia’s Electricity Surplus Fails to Lower Rates

The electricity surplus in West Virginia has not resulted in lower utility bills for residents, a trend that appears to be worsening. Despite generating more electricity than the state consumes, West Virginians are paying significantly higher monthly electricity bills compared to the national average. In 2024, the average residential electricity bill in West Virginia was $154.76, while the national average stood at $142.26, indicating that West Virginians are spending approximately 8.8 percent more than the average U.S. household.

Production Versus Consumption

According to the U.S. Energy Information Administration, West Virginia produced 50,594,818 megawatt-hours of electricity in 2024, with total in-state sales to residential, commercial, and industrial customers reaching 32,990,570 megawatt-hours. This results in a surplus of 17,604,248 megawatt-hours, meaning the state generated about one-third more power than it consumed, with much of the excess exported out of state.

Despite this surplus, the average household in West Virginia used 1,027 kilowatt-hours per month, surpassing the national average of 863 kilowatt-hours. This higher consumption rate is a significant factor in the elevated electricity bills, even though the average price per kilowatt-hour in West Virginia was 15.07 cents, lower than the national average of 16.48 cents.

Infrastructure Challenges and Financial Dynamics

The primary issue contributing to high electricity costs is the aging local distribution infrastructure. This outdated grid results in inefficiencies and increased energy losses, ultimately leading to higher costs passed on to consumers. Although the state benefits from some tax revenues—approximately $126.7 million collected in Business and Occupation taxes from public utilities and electric power producers in 2024—how much of this revenue directly benefits local communities remains unclear.

Utilities like Appalachian Power often claim that ratepayers benefit from the surplus because they “own” the power plants. They allege that revenue from excess electricity sales is credited back to customers through the West Virginia Public Service Commission’s (PSC) Expanded Net Energy Cost (ENEC) process. However, bills continue to rise as utilities recover their costs before any profits reach consumers.

The West Virginia Public Service Commission approved $321.8 million in ENEC recoveries for Appalachian Power Company and Wheeling Power Company in 2023, a process described as “making the utilities whole.” This means that before any potential benefits reach consumers, utilities prioritize recovering their guaranteed costs, including plant construction and maintenance.

Another critical factor is that energy companies are increasingly focused on long-distance high-voltage transmission projects, which offer guaranteed returns. These projects tend to be more lucrative than local generation, leading to less incentive for companies to invest in generation facilities near consumption areas. Instead, they construct expensive transmission infrastructure, the costs of which are ultimately passed on to local ratepayers.

In conclusion, while West Virginia has an electricity surplus, the combination of high consumption rates, aging infrastructure, and the financial structure of utility operations means that residents are unlikely to see lower bills in the near future. Unless state policies mandate investments in modernizing local distribution systems, West Virginians will continue to face above-average electricity costs despite living in a state that exports power.

Anthony Campbell, President of West Virginians Against Transmission Injustice, emphasizes that without significant changes in policy, the current situation will persist, further burdening local consumers as they pay for infrastructure that primarily benefits out-of-state interests.