June 1, 2012, Volume 1, Issue 23

06/01/2012

Update:  On May 30, 2012, the PUCO issued an entry granting AEP-Ohio’s extension of the interim capacity rates. In a 4-1 decision, Commissioners Roberto and Slaby only concurred in the result of Chairman Snitchler and Commissioner Lesser’s opinion, while Commissioner Porter dissented. The PUCO’s entry extends the interim relief that it gave AEP-Ohio but actually increases the first tier rate to $146/MW-day (and keeps the rate at $255/MW-day for the remaining parties) rather than use the PJM rate that drops to $17/MW-day on June 1, 2012. The PUCO’s entry was based on its March 7 Entry where it stated that “as applied to AEP-Ohio, … the state compensation mechanism could risk and unjust and unreasonable result.” Other than stating that the PUCO would not be able to issue a decision before the interim capacity rates expire, and based upon its previous decision, the PUCO did not provide much detail supporting its decision. On the other hand, Commissioner Porter’s dissent took the position that the PUCO’s March 2 Entry holding that the interim state compensation mechanism was to last only until May 31, 2012, and capacity rates for all competitive suppliers should be the RPM-based rate as of June 1, 2012. Also, Commissioner Porter stated that a record of evidence must be cited in support of the decision if the PUCO is to adopt anything else other than RPM-based rates for 100% of shopping load, which was not provided in the entry. This decision to extend the interim capacity rates will remain effective until the PUCO issues a final decision in the case or July 2, 2012, whichever comes first.Additionally, several parties submitted reply briefs this week, including the OMAEG. All parties continued to oppose AEP-Ohio’s proposal to charge $355/MW-day for capacity. Now, it is up to the PUCO to issue a decision.

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