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Ohio Utility Withdraws "Interim" Request To Use Generation From Utility-Owned Power Plant Entitlements To Supply Default Service Customers

March 2, 2017

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Copyright 2010-17 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

Given the pendency of its request and upcoming default service auction, AEP Ohio has withdrawn its interim request for approval to use its generation entitlements in the Ohio Valley Electric Corporation (OVEC) generation to serve Standard Service Offer (SSO) customers starting June 1, 2017

As exclusively reported by EnergyChoiceMatters.com, AEP Ohio had proposed in November changing the treatment of the OVEC entitlements, which are currently sold into the PJM market, with costs/benefits assigned to customers on a nonbypassable basis

In November, AEP Ohio proposed using the OVEC entitlements to serve SSO customers and recovering OVEC costs through bypassable SSO rates pursuant to §4928.143(B)(2)(a), Ohio Rev. Code. As proposed, AEP Ohio would then reduce the amount of power procured through its competitive auctions for SSO service by the amount of its OVEC entitlements, beginning June 1, 2017. The cost of the OVEC entitlements would be blended with the competitive auction rates to establish bypassable retail generation and retail capacity rates.

AEP Ohio's entitlements in OVEC equate to 354 MW of Unforced Capacity, and would amount to 12% of AEP Ohio's SSO (with the SSO competitive auctions procuring 12 fewer tranches of full requirements service for each delivery year)

As the proposal is still pending before PUCO (part of a larger ESP proceeding), and as the spring 2017 SSO auction is upcoming with various auction procedures already underway, AEP Ohio withdrew its request for "interim" relief with respect to its OVEC modification proposal

"More specifically, the [November] Amended Application requested an interim ruling on its proposal to use the OVEC contractual entitlement to serve SSO load as it relates to the delivery period beginning June 1, 2017 and the underlying Spring SSO auction. In light of the overall procedural schedule for these cases and in light of the Spring SSO auction schedule that is already well underway, AEP Ohio has decided to withdraw its interim relief in this case so that the Spring SSO auction can be completed without any modification or interruption," AEP Ohio said in a filing with PUCO

"The Company stands fully behind its OVEC proposal and continues to request that the Commission grant that proposal as part of its merit decision to be in place for the remainder of the extended ESP III term," AEP Ohio said

"As a related matter, the Company still plans to make a parallel filing amending its corporate separation plan to support the OVEC proposal, as discussed on page 26 of the Direct Testimony of Andrea E. Moore (filed November 23, 2016); that filing will be made in a separate docket but will facilitate the expedient implementation of a merit decision in these cases that grants the OVEC proposal," AEP Ohio noted

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