FERC sets AEP West rates for hearing, eyes input on merits of proposed ROE policy

摘要

East Texas Electric Cooperative’s second complaint contending that certain American Electric Power subsidiaries’ 10.7% base return on equity is too high has been set for hearing. The current base ROE for vertically integrated Public Service Company of Oklahoma and Southwestern Electric Power was derived from a February 2009 transmission formula rate settlement (ER07- 1069), while a September 2010 formula rate settlement agreement (ER10-355) set the base ROE for transcos AEP Oklahoma Transmission and AEP Southwestern Transmission. ETEC argued in a September 6 complaint (EL18-199) filed with the Federal Energy Regulatory Commission that the ROE for all four companies, referred to as AEP West, should be no more than 8.71%. “The current AEP West base ROE rests on the commission’s former one-stage [discounted cash flow] methodology and data from an era in which the economic environment and capital conditions differed significantly from those that prevail today, the complaint said, specifically noting a substantial decline in capital costs.