AEP Ohio proposes 1.8% base rate hike for 2021, first since 2011

American Electric Power Ohio customers could be paying more for electricity next year.

The power company asked state regulators Monday to approve an increase in AEP Ohio’s base rates that, if approved, would cost the average residential customer who uses 1,000 kilowatt hours a month an extra $2.20 in 2021.

That customer now pays $120 a month.

It would be AEP Ohio’s first increase in base rates since 2011.

The company was required to initiate this process under a 2018 agreement between regulators and other groups.

AEP Ohio has asked the Public Utilities Commission of Ohio to delay the procedural schedule for its request so that rates for its 1.5 million customers in the state would not go up for a year.

“We understand that our state and our customers are just beginning to recover from the economic impacts of COVID-19. The delay we have requested will give the economy more time to bounce back before any rate changes go into effect,” Raja Sundararajan, AEP Ohio president and chief operating officer, said in a released statement.

“Reliable electric service has been critical to helping our customers during the state’s stay-at-home period.”

A key element of the proposal is to continue to improve the reliability of its distribution system, the power company said. AEP Ohio is responsible for nearly 44,000 miles of distribution lines throughout its service territory.

Replacing equipment, preventive maintenance and tree-trimming have all reduced the frequency and length of outages, the power company said.

The filing also includes proposals to update streetlights and area lights leased by customers to more efficient and customizable LED fixtures; offer municipalities additional payment options for converting overhead service to underground; allow residential customers to pay their bills using a credit card without incurring additional processing fees; and build on programs that help customers reduce energy bills and increase efficiency.

AEP Ohio also wants to build on investments in electric vehicle charging stations.

In 2018, AEP Ohio provided $9.5 million to help local governments, workplaces and locations in low-income areas install charging stations for electric vehicles. Nearly 200 stations funded through the program are operational.

The company says its proposed rate hike is meant to ensure that the electricity grid is able to handle demand for charging electric vehicles.

AEP Ohio’s application will trigger a PUCO investigation. Once the five-member commission decides the case, it will be subject to appeal to the Ohio Supreme Court.

The PUCO said the purpose of regulation is to balance the needs of consumers and the utility.

Consumers, of course, want the lowest rates possible along with reliable service. The utility, meanwhile, wants enough money to cover costs while attracting and maintaining investment capital.

The PUCO will have public hearings on the proposal and take comments from consumers.

mawilliams@dispatch.com

@BizMarkWilliams