Public Utilities Commission of Ohio approves reduction of AEP Ohio rates due to Tax Cuts and Jobs Act
The Public Utilities Commission of Ohio (PUCO) adopted Wednesday a settlement agreement that will reduce AEP Ohio’s rates as a result of the Tax Cuts and Jobs Act of 2017.
AEP Ohio will return a normalized accumulated deferred income tax balance of approximately $278 million to customers over a federally prescribed period of approximately 25 years. AEP Ohio will also credit customers non-normalized excess deferred income tax of roughly $177.6 million over approximately a six-year period. Additionally, AEP Ohio will make annualized credits of $20.4 million until new base distribution rates go into effect as a result of a rate case expected to be filed in June 2020.
Previously, the PUCO approved $66 million in rate reductions of various AEP Ohio riders.
AEP Ohio estimates that the average residential customer using 1,000 kilowatt hours per month will see a reduction of $3.65 in their monthly bill.
“The Commission is pleased to approve an agreement that credits AEP Ohio’s customers with the utility’s reduced tax obligation,” PUCO Chair Asim Z. Haque said. “AEP Ohio’s rates now credit customers with hundreds of millions of dollars to accurately reflect the utility’s reduced tax obligation to the federal government.”
