AEP unit, EPA sign agreement for coal-fired emissions controls

Public Service Co. of Oklahoma (PSO), a unit of American Electric Power (NYSE: AEP), has entered into an agreement in principle with the U.S. Environmental Protection Agency, the state of Oklahoma and the Sierra Club that establishes a framework for PSO to comply with EPA regulations affecting the company’s two coal-fired units at its Northeastern Station in Oologah, Okla.

The agreement addresses PSO’s future obligations under the EPA’s Regional Haze rule (RHR) and EPA’s Mercury and Air Toxics Standard (MATS). Under the agreement, PSO would meet specified emissions rates at both Northeastern coal units, install certain emissions control equipment on one of the Northeastern coal units in 2015, and retire the other unit in 2016. The coal unit with the emissions controls would be retired in the 2025-26 timeframe.

The agreement also will result in PSO withdrawing its lawsuit against the EPA regarding the Regional Haze rule.

The parties to the agreement will work together to develop definitive settlement documents in the next 30-60 days. The settlement will then be subject to public review and comment.

PSO will file an environmental compliance plan with the Oklahoma Corporation Commission (OCC) that reflects the agreement. The OCC must approve costs associated with the plan before PSO can recover those costs from customers.

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