Newspaper article THE JOURNAL RECORD

Rates to Increase under Public Service Company of Oklahoma Settlement

Newspaper article THE JOURNAL RECORD

Rates to Increase under Public Service Company of Oklahoma Settlement

Article excerpt

Electric rates for Public Service Company of Oklahoma customers are expected to rise 10 percent four years after a settlement regarding environmental compliance challenges.

The economic impact on consumers will not be felt until 2016, said Stuart Solomon, PSO president and chief operating officer. The company announced the settlement regarding federal air quality rules relating to PSO's two coal-fired power plants at its Northeastern Station in Oologah.

"This is a phased settlement," Solomon said. "Nothing immediately will happen."

The agreement allows PSO to comply with Environmental Protection Agency rules, including the Regional Haze Rule and the Mercury and Air Toxics Rule, Solomon said.

The settlement does not affect OG&E coal-fired plants near Pawnee and Muskogee, said Brian Alford, OG&E spokesman. This month, OG&E joined Oklahoma Attorney General Scott Pruitt in asking the U.S. 10th Circuit Court of Appeals to block the EPA rule aimed at cutting emissions from coal-fired plants across the state.

Under the settlement, PSO agreed to meet emission rates at both Northeastern coal units, install emissions control equipment on one unit in 2015 and retire the other unit in 2017. The Tulsa-based utility will retire the unit with emissions control by 2026.

"This agreement gives us plenty of time to work through the process," Solomon said. "We already have a request-for-proposal on the street today, seeking additional natural gas resources to replace that unit."

Electric rates will increase once the first coal-fired plant is retired, Solomon said.

"We have done some general analysis and there will be a cost increase to consumers," Solomon said. "We anticipate a 10-percent increase but not until the 2016 time frame."

The settlement provides certainty for the utility, he said.

"We know exactly the kinds of costs that we will incur," he said. …

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