SWEPCO requests new Arkansas rates
SHREVEPORT, La., — Southwestern Electric Power Co., an American Electric Power company, submitted a request last week to the Arkansas Public Service Commission to update its prices. The company seeks to recover environmental and resiliency costs associated with providing customers cleaner and more reliable energy.
“We have made significant investments in wind-powered generation, specifically with the North Central Energy Facilities project,” said Malcolm Smoak, SWEPCO president and chief operating officer. “It’s a project that has environmental and economic benefits for SWEPCO’s customers, saving an estimated $2 billion over the next 30 years.”
The Public Service Commission unanimously approved the North Central Energy Facilities project in May 2020.
With no fuel cost for wind, NCEF lowers SWEPCO’s overall fuel cost for power generation. This fuel savings and federal Production Tax Credits more than offset the cost of the new facilities, resulting in net long-term savings to customers.
One of three NCEF wind facilities is now in commercial operation. The second and third facilities will begin operations later this year and early 2022, respectively. Arkansas customers get 268 megawatts of SWEPCO’s total purchase of 810 MW.
The $85 million request also includes recent investments in transmission and distribution facilities and reflects costs to operate and maintain equipment that delivers power to customers. It also establishes new tariffs for electric vehicles, lighting, and other measures.
If approved, new rates would likely go into effect in the first billing cycle of June 2022. An Arkansas residential customer using 1,000 kilowatt-hours per month would see a total bill of $130.20, an overall bill increase of $18.89 per month, or about 17%. This total includes SWEPCO’s 2021 winter storm costs, which are about $7.72 per month for a residential customer using 1,000 kilowatt-hours per month.
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 a direct pass-through to customers.