Dayton Power & Light Files Application to Separate Generation Assets from Utility

Dayton Power & Light has filed an application to transfer or sell its generation assets so that they are no longer owned by the utility.

DP&L was required to file such application under its latest electric security plan, with separation required to be completed by May 31, 2017.

"Despite the fact that the deadline for DP&L to transfer its generation assets was set a period of years into the future, DP&L is exploring its options related to the separation including issues and obstacles related to potentially transferring the assets to an affiliate as early as 2014," DP&L said.

"This application reaffirms the commitment of DP&L to make the transfer by May 31, 2017 as ordered, if not sooner," DP&L said.

DP&L said that it is developing a definitive plan for separation that, "at present, would involve transferring the assets to a newly formed affiliate generation company."

DP&L intends to file a supplement to its initial application, setting forth a detailed plan for such a separation, once the company has had the opportunity to complete its review of pending issues and their operational and financial impacts.

DP&L said that it has not finally determined whether the assets should be transferred or sold at book value, market value, or some other value, but has committed to notify the Commission promptly when that determination has been made. The net book value of DP&L's generating assets as of November 30, 2013 is approximately $1,576,440,886.

DP&L noted several complex issues that DP&L will need to resolve prior to separation of the generation assets, including the disposition of assets not owned wholly by DP&L, such as its entitlements in Ohio Valley Electric Corporation (an issue faced by AEP Ohio as well), as well as ownership in non-deregulated plants that DP&L does not operate. "Some of those assets are operated by partners that are located in states that are not deregulated. Thus, some of the generation assets that DP&L owns are operated as if the assets are fully regulated and subject to cost-based rate recovery. DP&L's interest in these plants are not aligned with how they are operated," DP&L said.

Case No. 13-2420-EL-UNC