Attorneys for Public Service Company of Oklahoma presented arguments to Oklahoma regulators on Wednesday, seeking a rate increase of nearly $132 million.
PSO attorney, Jack Fite, said the utility is entitled to reimbursement from customers for improvements made to the system. The company spent nearly $884 million since 2014 on system upgrades and air pollution reduction improvements to power plants, according to a report by The Journal Record.
PSO filed its rate case with the Oklahoma Corporation Commission in July 2015. When the utility failed to receive regulatory approval within a six-month period as set by law, PSO commenced an interim $75 million rate increase to customers effective January 2016.
The interim rate is subject to refund if the OCC finds the utility wasn’t entitled to the extra revenue. When PSO’s interim rates went into effect, the utility also passed along $140 million in lower fuel charges.
PSO spent $453 million from February 2014 through July 2015 on installing new electric poles and wires.
The utility also spent another $215 million this year on plant upgrades to meet federal environmental regulations.
While PSO asserts that it is entitled to a rate increase, opposing parties contend that the Oklahoma Corporation Commission should take alternative action.
Dara Derryberry, Assistant Attorney General with the Public Utility Unit, said it’s too early to ask customers to reimburse PSO for $215 million spent by the company to cut air pollution from coal-fired power plants, according to The Journal Record report. The attorney general’s office, which represents consumers in utility rate cases, is troubled by PSO’s attempted recovery of environmental costs falling outside the test year used to calculate new rates.
“On that basis alone, the commission should reject cost recovery of these environmental investments,” said Derryberry.
Thomas Schroedter represents the Oklahoma Industrial Energy Consumers, one of the parties supporting a rate decrease of $7 million. Schroedter takes issue with the utility’s timing for filing its rate case.
“They’re profiting from their approach,” said Schroedter.
PSO’s attorney disagreed with the notion that PSO should return money to customers. “How can a company invest more than a half-billion dollars and deserve a rate decrease?” he said.
Since the Administrative Law Judge did not provide a specific accounting recommendation, the three-member regulatory panel is requesting further input by August 26, with a September 2 deadline for groups to respond to the ALJ’s accounting recommendation.
The OCC took the matter under advisement and is expected to issue its decision on PSO’s rate increase later this year.