Oklahoma Corporation Commissioners plan a special Monday morning meeting to address opposition to a complicated Public Service Company of Oklahoma rate matter.
Commissioners, in their 9:30 a.m. meeting will delve into PSO’s application PUD2024-000032 to address a Private Letter Ruling from the IRS that was part of the company’s original request for a Net Operating Loss Carryforward attempt.
It was part of PSO’s original rate hike request of $218 million, a request that was lowered to $119.5 million and approved by commissioners on a 2-0 vote in January of this year. The final approval meant a $12 monthly hike for an average customer that was okayed in an interim rate impact in October of last year.
PSO had waited on an IRS Private Letter Ruling on a tax deferment issue in the case. The company had asked whether some expenses could be part of a regulatory asset.
A recommendation from an Administrative Law Judge would allow PSO to collect the NOLC accrual over a 20-month period and require the firm to record a regulatory liability for all NOLC collections, subject to customer refund based on any future IRS guidance.
But the Attorney General intervened and is seeking oral arguments on the case. Further, the AG disagrees with some of the findings of the ALJ.
“The Attorney General takes exception to the ALJ Report’s findings that the amortization of the NOLC should be collected over a 20-month period. The original request from PSO was to recover 36 previous months of NOLC accrual over an accelerated period. The fair, just, and reasonable method is to mirror the collection of the NOLC from customers over a similar 36-month period. This protects customers from the rate shock of an accelerated collection period.”
So are other groups including the Oklahoma Industrial Energy Consumers, the AARP and the Petroleum Alliance of Oklahoma.
In a filing with the commission, the OIEC contended, “PSO’s request is unreasonable, unnecessary, and unfair to
ratepayers.” This month, the opponents claimed, “OIEC, AARP, and Petroleum Alliance request that the Commission order that recovery of the regulatory asset be deferred until PSO’s next general rate case, which is anticipated to be filed next year….”
PSO serves nearly 573,000 customers throughout the state. Even with the negotiated lowering of the original request, it was strongly opposed by AARP. The organization’s attorney Adam Singer had stated last fall, “This, as far as I can tell, is the single-largest rate increase ever for PSO, and it comes on the heels of several and repeated rate increases.”
The Attorney General, in reaching a settlement of the original $218 million request indicated that PSO had agreed not to file another base rate increase request before Jan. 1, 2026.