ARKANSAS (KFSM) — Arkansas Southwestern Electric Power Company (SWEPCO) customers could soon see a price hike on their electric bills.
SWEPCO, an American Electric Power (NYSE: AEP) company, filed a settlement agreement on Tuesday (Oct. 15) for new rates at the Arkansas Public Service Commission.
If approved, the settlement agreement provides a net annual increase of $24.1 million in non-fuel base rates. SWEPCO was initially seeking a net annual increase of $45.6 million, plus $12 million for increased vegetation management, but settled for less.
Under the settlement agreement filed Tuesday, new rates would go into effect during the first billing cycle of January 2020. An Arkansas residential customer using 1,000 kilowatt-hours per month would see an overall bill increase of approximately $8.54 per month, or 8.8%, according to SWEPCO.
Along with SWEPCO, parties in support of the settlement agreement include APSC General Staff, Arkansas Attorney General Leslie Rutledge, Board of Trustees of the University of Arkansas, Walmart, Inc., Western Arkansas Large Energy Consumers and Sierra Club.
“We appreciate the careful consideration of our rate request, and we believe that all parties have worked toward an agreement that is fair for our customers and the company,” said Malcolm Smoak, SWEPCO president and chief operating officer in a press release. “We are committed to high quality customer service, managing our costs and investing in the electric system to provide reliable and safe power for the customers and communities we serve in Arkansas.”
Base rates are in reference to the cost of building, maintaining and operating SWEPCO’s electric system. This includes power plants, transmission and distribution lines and facilities to serve customers.
SWEPCO says base rates do not include the fuel portion of the customer’s bill, which finances fuel and purchased power and is a pass-through to customers, which the company makes no profit from.
A settlement hearing is scheduled for Oct. 21 at the APSC building in Little Rock. Public comment hearings are scheduled for Oct. 24 in Ashdown, Ark., and Oct. 29 in Fayetteville, Ark.
SWEPCO serves over half a million customers in three states, including 119,800 in Arkansas.