Office of the Ohio Consumers' Counsel

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Contact: Anthony Rodriguez (614) 466-9547

OCC seeks additional refund for customers from AEP's significantly excessive earnings

COLUMBUS, Ohio – March 20, 2012 – The Office of the Ohio Consumers' Counsel (OCC) will be continuing its advocacy for American Electric Power customers tomorrow when it presents oral arguments at the Supreme Court of Ohio against the utility's significantly excessive earnings. The OCC joined the appeal of the Public Utilities Commission of Ohio's (PUCO) decision in a significantly excessive earnings case involving AEP's Columbus Southern Power utility.

The OCC previously secured the return of $43 million after AEP overcharged its Columbus Southern Power customers in 2009. The 2009 earnings test was the first to occur under the Ohio electric energy law.

Ohio law prohibits electric utilities from collecting significantly excessive earnings and entitles customers to a larger refund than the PUCO ordered. Specifically, the OCC is asking for the return of an additional $22 million to customers after the PUCO allowed AEP to omit profits from electricity sales made outside its Ohio territory with Ohio-based assets.

The OCC has said all profits should be considered in the significantly excessive earnings test and the exclusion of some sales resulted in an unreasonable comparison against other public companies, and was a violation of Ohio law.

Ohio's electric energy law gives electric utilities flexibility about how to structure their rates, the power to veto a plan the PUCO approves, and the ability to earn profits that are excessive. As a counterbalance to these provisions, a consumer protection tool is built in which allows annual reviews of the profits earned and requires a return to customers of profits determined to be significantly excessive.

The OCC, and the Ohio Energy Group, will argue before the Court that it should return significantly excessive earnings associated with profits from electricity sales outside Ohio, as these are profits that the law intended to reach. The request from the OCC and Ohio Energy Group to reverse the PUCO's decision is important because it is the first time the Court has looked at the earnings review required under the statute, and it is important that this consumer protection tool be upheld so customers pay no more than what is just and reasonable.

The Industrial Energy Users, an association of large Ohio industrial energy consumers, and AEP also will present separate arguments to the Court on the treatment of the utility's profits.

A decision from the Court is not expected until late 2012, or 2013.

For more information about this case, consumers can search the Supreme Court of Ohio case docket for Case No. 2011-751.

About the Office of the Ohio Consumers' Counsel

The Office of the Ohio Consumers' Counsel (OCC), the residential utility consumer advocate, represents the interests of 4.5 million households in proceedings before state and federal regulators and in the courts. The state agency also educates consumers about electric, natural gas, telephone and water issues. For more information, please visit the OCC website at www.pickocc.org.