PSO requests $88 million rate hike approval

Public Service Company is asking state regulators for approval of an $88 million rate hike, one that would see an average customer’s monthly bill go up by $7.
The company explained the request was made to “ensure a safe, secure and reliable electric grid now and in the future under a more efficient regulatory framework.”
It also said as a result, the company would lower charges to customers for purchased power and fuel used in power generation.

PSO’s Grid Modernization and Efficiency Plan, filed Wednesday with the Oklahoma Corporation Commission (OCC) is needed for PSO to replace and upgrade aging electric infrastructure, while investing in new technology to maintain and improve reliability and efficiency.

A key element of the plan is the adoption of performance-based rates (PBR). PSO’s proposed PBR ties the Company’s financial condition to its ability to meet a set of customer-focused performance standards, called performance incentive measures (PIMS).

“Customers benefit from our financial condition being tied to the achievement of certain levels of reliability, safety and customer satisfaction. They also benefit from reduced price volatility since rates would be gradually adjusted as costs go up or down” said Emily Shuart, PSO Director, Regulatory Services. “PSO remains committed to providing our customers with safe, reliable, and affordable service and our proposal holds us accountable for accomplishing that.”

The filing includes a request to adjust PSO’s rates to recover increased costs related to aging infrastructure, storms, taxes and other necessary business expenses. For a typical residential customer, the requested increase amounts to approximately $7 per month. The overall rate increase request is $88 million.

Beginning with October bills, most PSO customers, including all residential customers will see a decrease in the amount they pay for purchased power and fuel for power generation. The typical residential customer will see lower fuel charges decrease their overall bill by approximately $5 per month.

What is PSO’s Grid Modernization and Efficiency Plan? PSO’s Grid Modernization and Efficiency Plan is a comprehensive plan to meet customers’ increasing needs for enhanced reliability, convenience and integration of technology while mitigating potentially large price increases. The plan includes upgrades to aging infrastructure, to invest in and accommodate new technology and analytics to keep the grid safe and secure. PSO, a unit of American Electric Power (NYSE: AEP), is an electric utility company serving more than 550,000 customers accounts in eastern and southwestern Oklahoma. Based in Tulsa, PSO has nearly 3,800 megawatts of generating capacity and is one of the largest distributors of wind energy in the state.

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