AEP awaits final approval of 4-state wind farm project

 

Only the state of Texas has yet to give approval to a three-wind farm purchase plan in Oklahoma by American Electric Power to supply power to Southwestern Electric Power Company…a project that already received approval from federal regulators.

Louisiana’s Public Service Commission signed off on the 1.5 GW North Central project. The approval in Texas could come any time and the project already has the support of regulators in Oklahoma  and Arkansas as well as the Federal Energy Regulatory Commission.

The approval for the $2 billion project by Arkansas came a week ago. American Electric Power CEO Nick Akins is confident the approval will come from Texas and if it doesn’t, “”the project has what it needs to go forward at 846 MW of the [planned] 1,485 MW.”

In early March, AEP filed a unanimous settlement among participating stakeholders in Louisiana covering 268 MW of the project.

In Texas, hearings concluded in February and AEP expects “a proposal for commission decision from the Texas [administrative law judges] in late May,” Akin said in a recent update. But the end of May was last week and the Texas Railroad Commission had not approved the project.

The potential approvals would come nearly two years after AEP canceled the 2 GW Wind Catcher project​, following its rejection by Texas regulators.

The North Central project involves the purchase of three wind facilities being developed by Invenergy in Oklahoma — 199 MW Sundance, 287 MW Maverick and 999 MW Traverse — to serve customers of AEP subsidiaries Southwestern Electric Power Company and Public Service Company of Oklahoma.

Sierra Club voiced its support for the project and encouraged Louisiana and Texas regulators to provide the remaining approvals. The group previously approved of the Wind Catcher project.

“Sierra Club thinks the wind project should move forward so it can deliver clean, safe and affordable energy to AEP/SWEPCO customers,” Al Armendariz, the group’s deputy regional director told Utility Dive in an email.

“Oklahoma and Arkansas realize the benefits this project will provide for monthly bills and we hope regulators in Louisiana and Texas will follow their lead,” he said.

While the North Central project remains on track, AEP saw a drop in Q1 financials. Tierney reported that AEP’s Q1 operating earnings were $1.02 per share or $504 million, compared to $1.19 per share of $585 million in 2019, with the decrease driven by “warmer than normal winter weather and lower normalized retail load,” along with “lower generation sales due to lower energy prices and plant retirements,” among other factors.

To offset the expected decline in retail sales in 2020, AEP is reducing operations and maintenance expenses an additional $100 million in 2020, leaving the company “inside but in the lower half of the original operating earnings guidance range” of $4.25 to $4.45 per share​, Tierney said.

AEP expects the Sundance facility to come online by the end of 2021 and the Maverick and Traverse facilities by the end of 2021.

Source: Utility Dive

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