Source: American Electric Power (AEP)
AEP Ohio, a unit of American Electric Power (NYSE:AEP), has filed its Electric Security Plan (ESP) with the Public Utilities Commission of Ohio (PUCO) for rate adjustments beginning in 2012. The company's ESP is a comprehensive plan that proposes limited customer bill increases on generation rates, while encouraging investment in electrical infrastructure and consumer programs within the state of Ohio.
The plan provides continued support of programs to assist low-income customers with their electric bills, adds renewable energy sources to the company's generation mix, continues energy efficiency efforts and gives consumers an option to directly purchase a portion of their electricity from renewable sources. In addition, AEP Ohio's ESP introduces the Ohio Growth Fund, a $25 million shareholder contribution designed to support economic development throughout AEP Ohio's service territory over the ESP term.
"This ESP proposal reflects current state policies in the form of rates designed to be competitive with market prices, while preserving a path to sustained investment and longer-term price certainty for our customers," said Joe Hamrock, AEP Ohio president and chief operating officer. "The ESP filing also allows AEP Ohio to continue to provide various services that focus on development of renewable energy resources, technological advances to transform our generation resource portfolio mix and modernization of the electrical grid infrastructure."
In keeping with state policy, the company's ESP establishes rates for all customer classes to more accurately reflect today's competitive market prices and pricing structures, while proposing a mechanism that would reduce rate impacts resulting from this redesigned rate structure. In addition, the ESP filing provides an alternative long-term price option for certain industrial and commercial customers to support their continued investment in Ohio by providing price certainty for up to three years beyond the ESP period.
The plan reflects AEP Ohio's proposed merger of Columbus Southern Power (CSP) and Ohio Power (OPCo) through a single set of rates for all AEP Ohio customers. For the average CSP residential customer using 1,000 kilowatthours (kWh) per month, approval of the plan would result in an increase in a customer's total monthly bill of approximately $1.83 or 1.51 percent in 2012. For the average OPCo residential customer using 1,000 kWh per month, approval of the plan would result in an increase in a customer's total monthly bill of approximately $5.50 or 4.87 percent in 2012.
The components of this filing include requests to recover costs associated with closing AEP Ohio-owned generation facilities; acquiring new generation resources, including renewable capacity that AEP Ohio owns or operates for the benefit of Ohio customers; and environmental investments incurred after Jan. 1, 2009.
In its request, AEP Ohio also is asking for the PUCO to consider mechanisms to support reliability improvements, the expansion of the company's gridSMART program and new programs, including a Renewable Power Option for customers who want to source significant portions of their energy usage from AEP Ohio's renewable portfolio and a tariff for residential customers installing equipment to support plug-in electric vehicles.
The PUCO is expected to deliver an opinion and order on the company's ESP no later than the fourth quarter of 2011.
AEP Ohio also notified the Commission of its intent to file a distribution rate case next month. This request seeks to bring the distribution rates in line with the current investment and costs necessary to provide distribution service to customers. It has been nearly two decades since either CSP or OPCo filed distribution rate cases for their respective service areas.
AEP Ohio files Electric Security Plan for 2012
Source: American Electric Power (AEP)