Allegheny Energy has agreed not to raise bills by more than 15 percent starting next year for Potomac Edison customers.

The agreement was announced today by Allegheny Energy, the Virginia State Corporation Commission and Attorney General's office, and a group of commercial and industrial customers.

The agreement requires the commission's approval. It would permit the recovery of purchased power costs in Virginia for Potomac Edison while avoiding dramatic rate increases. Potomac Edison serves about 100,000 customers in Virginia.

Allegheny Energy previously increased rates $73 million through next June and will maintain those interim rates under the agreement. The company also agreed not to increase bills by more than 15 percent from July 2009 through June 2010.

Since July 2007, the company's cost of purchasing power for Potomac Edison customers has increased dramatically, primarily due to increased costs for fuel, such as coal and natural gas. As a result, the company is facing a shortfall of more than $100 million in Virginia this year, making it necessary to seek the increased revenues in the agreement.