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PUC Denies Rehearing Of Purchase of Receivables (POR) Order, Sets Process To Address Further Cost Recovery Issues In Implementation Plan

March 1, 2018

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

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The Public Utilities Commission of Ohio denied rehearing requests from AEP Ohio and the Ohio Consumers Counsel concerning PUCO's September 27, 2017 order which had set certain parameters for a purchase of receivables (POR) program at AEP Ohio

See full details of PUCO's September 27, 2017 order here

Among other things, PUCO said that in its September 27, 2017 order, "the Commission made three points abundantly clear."

• First, we affirmed our original mandate that CRES [retail] providers should be permitted to opt out of participation in AEP Ohio's POR program.

• Second, we directed that CRES providers that elect to participate in the POR program should pay for the program.

• Third, we reiterated that AEP Ohio should recover both the implementation and maintenance costs associated with the POR program.

"After confirming these guiding principles, we directed AEP Ohio to meet with any interested parties to discuss the costs and process for implementing an opt-out POR program and, following those discussions, to file a full cost estimate for implementation, along with a: list of CRES providers that have agreed to participate in the program and compensate the Company for the implementation costs," PUCO said

"Once that information has been filed in a new docket, the Commission will establish the next steps to proceed with the implementation of the opt-out POR program, including any necessary clarification regarding the implementation and cost recovery details. AEP Ohio's application for rehearing should, therefore, be denied at this time," PUCO said

In setting forth this process for further considering, "any necessary clarification," PUCO denied AEP Ohio's requested rehearing. Specifically, AEP Ohio had requested the following:

• That each CRES provider that elects to opt into the POR program should be required to make a binding five-year participation commitment and agree to pay its fair share of prudently incurred program costs.

• That the Commission should clarify that the per-bill fee methodology addressed in Paragraph 46 of the Finding and Order will result in an annual true-up of the per-bill fee, which will consider, among other things, the current number of CRES providers and retail customers being served, as well as a final reconciliation of the per-bill fee that will be paid by the participating CRES providers until the costs are fully recovered by AEP Ohio.

• Any costs that are not recovered from participating CRES providers will be deferred with a carrying charge and recovered from AEP Ohio's customers through rates.

PUCO denied these requests for hearing as noted above.

Separately, OCC sought rehearing concerning PUCO's prior order that held that AEP Ohio could use its bad debt rider (BDR) as a recovery mechanism of last resort to collect CRES providers' receivables.

PUCO denied OCC's rehearing requests concerning the BDR, stating, "We find no merit in OCC's contention that the use of the BDR as a backstop mechanism for AEP Ohio's recovery of FOR program costs is contrary to R.C. 4928.08(B)."

"Our determination that AEP Ohio should use the BDR, as a backstop mechanism, to recover any bad debt costs associated with the POR program that are not otherwise recovered from CRES providers is consistent with our position that the Company should be assured of full cost recovery before proceeding with the implementation of the program," PUCO said

Case No. 15-1507-EL-EDI

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