AEP-PSO seeks to raise monthly rider
BY ROD WALTON World Staff Writer
Thursday, August 16, 2012
AEP-PSO wants to raise the maximum monthly rider it can charge customers to recoup costs for energy efficiency programs, officials of the utility said Thursday.
Tulsa-based American Electric Power-Public Service Company of Oklahoma is asking the Oklahoma Corporation Commission to waive the $1.90 monthly limit for residential customers to fund its Demand Side Management Cost Recovery rider.
The request will be the subject of a hearing Oct. 17 at the commission’s office in Oklahoma City.
The rider has been added for nearly three years to help AEP-PSO with lost revenues and other expenses related to efficiency programs such as Energy Star lighting, appliances, weatherization programs and air conditioning unit tune ups. The new demand-side plan, if approved, would cover the 2013, 2014 and 2015 fiscal years.
“In our case, we have projected that we would go over the $1.90 maximum” to recoup costs for developing and using the efficiency programs, said Eric Raines, manager of energy efficiency and consumer programs for AEP-PSO.
If approved by the Corporation Commission, average residential customers using 1,101 kilowatt hours per month could pay up to 62 cents more for the demand-side rider. Commercial customers using 6,188 kilowatt hours could pay $3.47 in additional charges, while the average industrial customers using 475,426 kilowatt hours per month could be charged about $895.51 more under the rider.
The Tulsa World contacted several representatives of industrial utility customers, but they wanted more time to examine the new request before making comments. AEP-PSO’s Raines expected those groups to intervene in the case.
“The largest industrial customer’s main concern will be to still retain the option to opt out” of the program, he said. Under the current plan, “the majority of those who qualify (as large industrial customers) have opted out.”
Participation by residential customers, who must pay the rider, varies widely according to the individual parts of the efficiency program. The compact fluorescent light rebate program is probably the most popular, with thousands of volunteer participants.
AEP-PSO spokesman Stan Whiteford pointed out that many larger customers have received significant rebates from implementing cost-savings measures. Bartlesville Public Schools is due to receive a $33,000 incentive check next month for changing out 4,000 light fixtures to more efficient types.
“Customers who are taking advantage of the program offerings, they’re saving real money,” Whiteford said. “Other customers benefit because it allows us to delay building additional generation.”
Overall, AEP-PSO’s state filing indicates that the programs have saved close to 52 gigawatt hours in electrical generation through the first two years. The utility’s fiscal 2012 statistics are not available.
AEP-PSO’s costs to help reduce consumption, however, are anticipated to rise over the next three years. The portfolio’s cost will exceed $86 million up through 2015, according to estimates.
“PSO plans to increase the budget each year, which it expects will lead to increases in reductions of energy and demand,” Raines said in written testimony filed earlier this summer with the Corporation Commission’s Public Utility Division.
AEP-PSO officials said they just want to raise the rider’s limit but noted that the cost may not increase that much. For instance, this year’s rider is at about $1.56 per month for residential customers, Raines said.
The projection for 2013 is as much as $1.83 per month, $2.07 in 2014 and $2.38 in 2015, according to testimony.
“That’s the high end of projections if everything (demand side and efficiency program) sold out,” Raines said.
Overall demand may be falling for AEP-PSO, but heat waves during the past two summers caused numerous peak-use records for electricity system-wide. The new peak use record was unofficially 4,424 megawatts on Aug. 1., Whiteford said.