PUCO to resolve AEP small business customer rate issues

COLUMBUS, OHIO (Feb. 10, 2012) – The Public Utilities Commission of Ohio (PUCO) today announced that it will soon address the significant impacts that AEP rate changes are having on General Service 2 customers who are primarily small businesses, school districts and local governments. The PUCO has been contacted by legislators, Gov. John Kasich, and more than 200 affected customers who are faced with exorbitant bill increases that will have a lasting negative impact on operations.

“My fellow commissioners and I are deeply troubled by what we have heard from business owners, elected officials, and the governor on this issue,” PUCO Chairman Todd A. Snitchler stated. “We acknowledge the negative impact our decision is having on small businesses, the backbone of Ohio's economy. To those affected customers, we too are deeply concerned and are fully committed to addressing the situation quickly. We want to resolve this issue so you can get back to positively impacting the economic recovery beginning to take place in Ohio.”

Last December, the PUCO modified and approved an agreement in AEP-Ohio’s electric security plan case. The agreement was signed by a variety of parties representing manufacturers, energy suppliers, and environmental groups among others. The PUCO held local public hearings to gather input and vetted the agreement through a transparent legal process during which 30 witnesses provided testimony and faced cross-examination.

Under the modified agreement, AEP will transition to a market-based generation rate structure over a four and a half year period from 2012 to 2016. AEP will separate its generation and distribution assets, and, beginning in June 2015, procure electricity for customers through competitive auctions.

While the move toward competition will ultimately benefit consumers, the rate plan includes new charges to recover several hundred million dollars worth of deferred distribution and fuel costs, as well as costs to transition to the market-based model. The Commission allocated these rate impacts among customer classes based upon figures and information provided by AEP.

“Our decisions are only as good as the company billing information they are based upon,” Snitchler stated. “In this case, we depended upon AEP to provide accurate data upon which to base our decision. Now that we have a full understanding of the impacts, we are actively developing a plan to resolve the rate impacts faced by affected General Service 2 customers. While I cannot prejudge the outcome, we will take this issue up immediately so that there can be a long-term resolution in place by the end of this month.”

The PUCO encourages affected customers to file written comments online in case 11-346-EL-SSO. Additional information regarding the AEP rate changes and impacts on small business is available at www.PUCO.ohio.gov.

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The Public Utilities Commission of Ohio (PUCO) is the sole agency charged with regulating public utility service. The role of the PUCO is to assure all residential, business, and industrial consumers have access to adequate, safe, and reliable utility services at fair prices while facilitating an environment that provides competitive choices. Consumers with utility-related questions or concerns can call the PUCO Call Center at (800) 686-PUCO (7826) and speak with a representative.

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