PUCO adopts agreement establishing green pricing option for AEP-Ohio customers

COLUMBUS, OHIO (May 2, 2007) - The Public Utilities Commission of Ohio today adopted a stipulation that establishes a green pricing option for American Electric Power Ohio (AEP-Ohio) customers. The option would enable the company's customers to participate in a voluntary, market-based alternative to AEP-Ohio's standard service offer.

"We are pleased that AEP-Ohio customers will have the opportunity to invest in renewable energy resources through the purchase of green power," PUCO Chairman Alan R. Schriber stated. "The green pricing option will also encourage innovation in the retail electric market."

The green pricing option will be established through AEP-Ohio's purchase of Renewable Energy Certificates (RECs) at prices determined through a national competitive bidding process. The PUCO will oversee the process.

Green power is defined as a service that must come from RECs from green resources. Green resources are defined as wind, solar photovoltaic, biomass co-firing of agricultural crops and all energy crops, hydro, incremental improvements in large scale hydro, coal mine methane, landfill gas, biogas digesters and biomass co-firing of any woody waste. Only green resources that have been brought into service on or after Jan. 1, 1997 will qualify for the green pricing option. RECs must be sourced from green resources located in the region covered by the Reliability First Corporation.

Customers that choose to participate in the green pricing option will be billed the same standard service rates and riders as non-participants plus the green pricing option tariff rider price for each block of the green power purchased. Customers will have the ability to purchase the green option at any time through Dec. 31, 2008.

The amount of megawatt hours bid through the competitive bidding process will be based on the assumption that 1 percent of AEP-Ohio?s customers would purchase two 100 kilowatt hour blocks of the green option. The green pricing option price will be set to recover the weighted average cost of the winning bid(s) and AEP-Ohio's program administration costs which must not exceed $125,000.

AEP-Ohio will implement the green pricing option within four months. If AEP-Ohio is not able to secure sufficient RECs through the competitive bidding process to meet customer demand, the company could terminate the green pricing option earlier than Dec. 31, 2008.

On Aug. 9, 2006, the Commission directed AEP-Ohio to file a plan to comply with competitive bid process requirements following a remand by the Ohio Supreme Court on July 5, 2006 in the case establishing the company's rate stabilization plan.

AEP-Ohio filed its proposed plan on Sept. 22, 2006. The company held a technical conference on Oct. 16, 2006 to discuss the plan with potential suppliers and other stakeholders. The Commission established a comment period for interested parties. Initial comments were due by Jan. 12, 2007 and reply comments were due to the Commission by Jan. 22, 2007.

On March 23, 2007,AEP-Ohio, PUCO staff, the Office of the Ohio Consumers' Counsel, Ohio Energy Group and Ohio Partners for Affordable Energy filed the stipulation that the Commission adopted today. 

Copies of the stipulation and the Commission's order issued today are at www.PUCO.ohio.gov. Click on the link to Docketing Information System and enter the case number 06-1153-EL-UNC.

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Also See Consumers' Counsel News Release on PUCO AEP Green Pricing Order [CLICK HERE].