One of the groups fighting the $218 million rate hike request filed by Public Service Company of Oklahoma is the AARP, American Association of Retired Persons.
It is siding with Attorney General Gentner Drummond in opposing the request that was filed only a few months after PSO obtained another rate hike last fall from Oklahoma Corporation Commissioners. The AARP says the Attorney General is right in fighting PSO’s push to boost its return on equity, known as ROE, from 9.30% to “a staggering 10.8%, resulting in more costs to customers.” Instead, the Attorney General suggests a ROE of 9.50%.
The AARP declared that it supports the call of two other opposing groups, the Commission’s Public Utility Division and the Oklahoma Industrial Electric Consumers. The PUD proposed a 9.30% ROE and OIEC suggested a 9% return on investment.
“No expert in this matter comes close to calculating an ROE
of 10.8%, as requested by the Company. AARP supports the appropriate ROE will be found in the range of 9.00% to 9.30%,” stated AARP in a filing against the rate hike request.
AARP and the other opposing groups also took a stand on PSO’s request to change its capital structure from the current 52% equity and 48% debt to 51.12% equity and 48.88% debt. The AARP says it would only “create additional costs to customers.”
The OIEC called for a 43.50% equity layer,the PUD 51.12% and the AG 50%. AARP wants the use of a 50/50 equity-debt capital structure.
Just as the state Attorney General opposed allowing PSO to force ratepayers to finance the utility’s association and chamber of commerce fees, the AARP agrees. It came out against $772,21 in dues and memberships as well as $121,640 in Directors and Officers Liability Insurance and $48,658 in Investor Relations Expenses.
