The Great Utility Refund Vanishes: Virginia Supreme Court Reverses Course on Appalachian Power 'Excess Profits'

Well, here we are again. Just when customers of Appalachian Power might have dared to hope for a bit of relief on their monthly statements, Virginia’s highest court, the Supreme Court, has stepped in. And with a single ruling, it effectively — and quite decisively, one might add — swatted away an earlier order that would have seen hundreds of millions in 'excess profits' returned to the very folks who paid them.

You see, it all goes back to 2017. The State Corporation Commission, or SCC as it’s often known, had looked at Appalachian Power’s books for that year and concluded, rather plainly, that the utility had raked in a staggering $312 million beyond what was deemed reasonable. A pretty penny, wouldn't you say? And honestly, the SCC decided that this money, these so-called 'excess profits,' should either be refunded directly to customers or applied as credits to future bills. A win for the consumer, or so it seemed.

But hold on a minute, because this story takes a turn, as these things often do. Appalachian Power, understandably perhaps, wasn't exactly thrilled with this prospect. They argued, quite vociferously in fact, that the SCC’s order was, in their view, utterly unlawful. And you know what? They took their case all the way up the judicial ladder, eventually landing before the Virginia Supreme Court.

And this is where the plot thickens. The Supreme Court, after careful deliberation, sided with the utility. Their reasoning? The SCC, in its zeal to protect consumers, had apparently based its decision on a statute that — get this — had been repealed. Not only that, but they had applied it retroactively. A rather significant procedural misstep, the court determined, rendering the SCC's order null and void.

It’s a win for Appalachian Power, undoubtedly. But for the roughly 550,000 customers in Virginia who depend on them for electricity? Well, it’s a bit of a gut punch, really. Those refunds, those potential bill credits that were once on the horizon, have now evaporated. Attorney General Jason Miyares and various consumer advocates had, for their part, championed the SCC's original decision, hoping to keep those funds in the hands of everyday Virginians. But alas, the court's interpretation of the law was, in the end, the final word.

The legal landscape surrounding utility earnings is, in truth, a labyrinth. The 2015 Grid Transformation and Security Act, which replaced older rules, introduced a new framework for how these companies’ profits are evaluated. And this particular ruling, you could say, underscores just how critical — and sometimes frustrating — the precise application of these complex laws can be. For once, the spirit of consumer protection, however well-intentioned, ran headlong into the letter of the law, and the law, it seems, won the day.