8-KRegulation FD

AMERICAN ELECTRIC POWER CO INC 8-K Report, Regulation FD Disclosure (Jul 6, 2006)

Filed July 6, 2006For Securities:AEP

Summary

This 8-K filing from AMERICAN ELECTRIC POWER CO INC (AEP) on July 5, 2006, reports a significant development regarding the Rate Stabilization Plan (RSP) for its Ohio subsidiaries, Columbus Southern Power Company and Ohio Power Company (collectively, AEP Ohio). The Supreme Court of Ohio has vacated the Public Utilities Commission of Ohio's (PUCO) order approving the RSP and remanded the matter for further proceedings. This decision mirrors a previous ruling on First Energy's RSP, citing a lack of competitive bid generation supply options for customers as stipulated by Ohio's electric utility restructuring law. AEP Ohio has the option to request reconsideration of the Supreme Court's decision. Importantly, AEP Ohio believes it can continue to collect rates consistent with the RSP while the matter is under review by the PUCO, which is currently deliberating on how to handle the First Energy RSP remand.

Key Highlights

  • 1Supreme Court of Ohio vacated the PUCO's approval of AEP Ohio's Rate Stabilization Plan (RSP).
  • 2The RSP has been remanded to the PUCO for further proceedings.
  • 3The Court's decision is based on the RSP not providing customers with a competitive bid generation supply option, as required by Ohio law.
  • 4AEP Ohio has the right to request reconsideration of the Supreme Court's ruling within ten days.
  • 5AEP Ohio believes it can continue collecting rates under the existing RSP pending PUCO reconsideration.
  • 6The PUCO is currently evaluating how to address a similar remand for First Energy's RSP.

Frequently Asked Questions

The primary impact is that the Supreme Court of Ohio has vacated the Public Utilities Commission of Ohio's (PUCO) order approving AEP Ohio's Rate Stabilization Plan (RSP) and sent it back to the PUCO for further review. This means the current RSP is no longer officially approved by the PUCO and requires further action.

The Court vacated the RSP because it did not provide customers with a competitive bid generation supply option, which is a requirement under Ohio's electric utility restructuring law. This mirrors a previous decision concerning First Energy's RSP.

According to the filing, AEP Ohio believes it can continue to collect rates reflecting the RSP. This suggests that customers may not see an immediate change in their electricity bills, pending the outcome of the PUCO's reconsideration of the RSP.

AEP Ohio has ten days to file a request for reconsideration with the Supreme Court. If they do not, or if the request is denied, the RSP will be returned to the PUCO for reconsideration. The PUCO is also currently reviewing a similar situation with First Energy's RSP.