PSO customers to get fuel hike starting in May

Electric customers of Public Service Co. of Oklahoma will see higher bills starting in May as the utility passes along higher fuel costs, largely from rising natural gas prices.

The typical residential customer using 1,110 kilowatt-hours of electricity each month will have a monthly bill increase of about $6, PSO said Wednesday. Across all customer classes, the fuel increases will range from 6 to 10 percent.

Under Oklahoma law, public utilities can’t profit on fuel and purchased power costs. Those passthrough costs are tracked by the utility and regulators and adjusted periodically.

“We understand any change to rates can be concerning for customers,” said Steve Fate, PSO’s vice president for regulatory and finance. “But it is necessary to adjust for the higher fuel prices now to help avoid larger increases later.”

The fuel portion of bills shows up as a long decimal on utility bills as a rate per kilowatt hour of electricity. Its calculation comes from the price of the commodity, transportation, storage and related costs. It also includes similar items for the fuel costs in the utility’s long-term power-purchase contracts.

For PSO, the fuel factor is on a shaded box on the left side of customer bills.

The previous forecast used by the utility to set the fuel factor had natural gas at $3.10 per thousand cubic feet. But it rose to as high as $3.60 per thousand cubic feet during the winter. It has gone down since then, but PSO had fuel under-collections of about $40 million, said spokesman Stan Whiteford.

The utility said its fuel factors will be reviewed again in October to see if further adjustments are necessary.

Tulsa-based PSO has more than 545,000 electric customers in eastern and southwestern Oklahoma. It is a unit of Ohio-based American Electric Power Co. Inc.