Kentucky Power responds to Kentucky PSC fuel case decision

Kentucky Power President and Chief Operating Officer Greg Pauley issued the following statement in response to Thursday’s order from the Kentucky Public Service Commission.

“We are still reviewing the decision and determining next steps. We are pleased that the Kentucky Commission affirms that our purchase of the Mitchell Plant generation represents the lowest reasonable cost alternative for replacing Big Sandy Unit 2 over the long term. However, we are disappointed by the suggestion that we purposefully did not disclose all cost information associated with that purchase. We have repeatedly demonstrated throughout our long history with the PSC that we are open and transparent in all of our proceedings and have never intentionally misled the Commission in our dealings. The increase in fuel costs disallowed by the Kentucky PSC resulted from having both the Mitchell and Big Sandy generating units in operation during the period evaluated. It will no longer be an issue after Big Sandy Unit 2 is retired,” Pauley said.

“Kentucky Power customers actually realized $9.9 million in net cost benefits from having both Big Sandy Unit 2 and the Mitchell unit available to generate electricity during the extreme cold of the polar vortex last winter. Without both generating units, we would not have been able to generate enough electricity to serve our customers and would have been purchasing power from the market when costs were extraordinarily high,” Pauley said.

Kentucky Power, with headquarters in Frankfort, Ky., provides service to approximately 172,000 customers in all or part of 20 eastern Kentucky counties. It is a unit of the AEP system, one of the largest electric utilities in the United States, with more than 5 million customers in 11 states. AEP ranks among the nation’s largest generators of electricity, owning nearly 38,000 megawatts of generating capacity in the U.S. AEP also owns the nation’s largest electricity transmission system, a nearly 39,000-mile network that includes more 765 kilovolt extra-high voltage transmission lines than all other U.S. transmission systems combined.