The Public Service Company of Oklahoma says new EPA Regional Haze rules is forcing the utility to seek a massive rate increase. The company today filed for a $172 million increase with the Oklahoma Corporation Commission. PSO's Stan Whiteford says costs to comply with EPA rules account for $96 million of the $172 million increase in the filing. Those costs were primarily to address the EPA’s Regional Haze Rule.
The total represents an overall rate increase of 13.6 percent. A residential customer with average electricity usage would see an increase of $14.53 on their monthly electric bill, beginning in early 2016. Even with the proposed increase, PSO’s rates will remain below the state, regional, and national averages.
Originally facing EPA requirements that would have cost close to $1 billion, PSO filed a lawsuit against the EPA, and then worked with Oklahoma leaders to develop an Oklahoma compliance plan that drastically reduced those costs. The plan developed by PSO and State leaders was approved in 2014 and saves PSO’s customers approximately $650 million in upfront investment costs as compared to EPA’s plan. PSO’s plan also ensures continued reliable electric service to customers, and benefits the State’s economy by increasing the use of Oklahoma natural gas and wind generation.
Under the plan, PSO will retire one of two coal-fired electric generating units at Northeastern Station in Oologah in 2016. It will replace that unit with power purchased from an Oklahoma natural gas–fired facility. PSO is installing environmental controls on the second coal-fired unit at Northeastern Station and will operate it until 2026. Replacement power for that facility will be determined by evaluating the best options for PSO customers at that time.
“We understand how challenging a rate increase can be for our customers, and although we are required to comply with EPA rules, we worked very hard to develop a plan that minimizes impacts to customers,” said Stuart