SHREVEPORT, La., Feb. 5, 2018 – The Public Utility Commission of Texas (PUCT) has approved a base rate increase for Southwestern Electric Power Co. (SWEPCO), a unit of American Electric Power (NYSE: AEP).
The PUCT approved the increase in base rates to recover the costs of installing additional environmental controls at four major power plants, along with other generation, transmission, and distribution-related investments and operating costs.
The bill for a Texas residential customer using 1,000 kilowatt-hours (kWh) will increase approximately $8.59 per month, or 8.9 percent. This increase will begin with bills issued Feb. 5.
By Texas law, new rates are retroactive to May 20, 2017. A surcharge to collect the retroactive amounts will begin at a date to be determined by the PUCT. For residential customers, the surcharge is expected to be approximately $7.70 per month, or 7.9 percent, for an estimated 10 months.
“SWEPCO invested nearly $700 million in additional environmental controls so that four of our major power plants could meet stringent federal mandates,” said SWEPCO President and Chief Operating Officer Venita McCellon-Allen. “The retrofit projects were necessary for SWEPCO to continue providing reliable 24/7 power to our customers from a diverse energy resource mix,” McCellon-Allen said.
“We work hard to balance the need to make investments with the need to manage our costs because we recognize the impact that price increases can have on individuals, families and businesses,” McCellon-Allen said. “SWEPCO’s goal is always to serve Texas customers with a strong electric system that provides reliable, safe and affordable energy.”
SWEPCO completed major environmental retrofit projects at Welsh Power Plant Units 1 and 3 in Pittsburg, Texas; Pirkey Power Plant in Hallsville, Texas; Dolet Hills Power Plant in Mansfield, La.; and Flint Creek Power Plant in Gentry, Ark.
The PUCT decision, issued in a Jan. 11, 2018 final order, grants SWEPCO an annual base rate increase of $50 million.
Base rates refer to the costs of building, maintaining and operating SWEPCO’s electric system, including power plants, transmission and distribution lines, and facilities to serve customers. Base rates do not include the fuel portion of the customer’s bill, which pays for fuel and purchased power and is passed through to customers with no profit to the company.
SWEPCO serves 532,000 customers, including 184,300 in northeast Texas and the Texas Panhandle, 230,300 in northwest and central Louisiana, and 117,400 in western Arkansas. SWEPCO’s headquarters are in Shreveport, La. News releases and other information about SWEPCO can be found at SWEPCO.com. SWEPCO is an American Electric Power (AEP) company. AEP is one of the largest electric utilities in the United States, delivering electricity to nearly 5.4 million customers in 11 states.