Louisiana PSC approves SWEPCO deal related to coal retrofit projects

The Louisiana Public Service Commission on Dec. 21 approved an uncontested partial stipulated settlement agreement between commission staff and Southwestern Electric Power Co. (SWEPCO), which allows SWEPCO to defer certain costs associated with environmental retrofit projects at three of its coal units as necessary for environmental regulatory compliance.

In Nov. 1 testimony, SWEPCO requested an accounting deferral from the time the these retrofit projects were placed in service until the time they are placed in rates. The projects are:

  • Welsh Units 1 and 3 – activated carbon injection, fabric filter and new chimney, plant located in Texas; and
  • Flint Creek – dry flue gas desulfurization system, plant located in Arkansas.

According to SWEPCO these costs were necessary to comply with the U.S. Environmental Protection Agency’s Regional Haze, Mercury and Air Toxics Standards and Cross State Air Pollution rules. Staff and SWEPCO agreed to the accounting deferral subject to certain conditions as set forth in a stipulated settlement.

The in service dates for these projects were:

  • Welsh Unit 3 – March 22, 2016;
  • Welsh Unit 1 – April 28, 2016; and
  • Flint Creek – June 12, 2016.

Louisiana commission staff and SWEPCO agreed that SWEPCO needs to file no later than Jan. 31, 2017, a request for a prudence review of these projects. Based on that proceeding the commission will determine the reasonableness and prudence of the projects and SWEPCO’s costs and therefore the amounts appropriate for recovery in customer rates.

SWEPCO is a subsidiary of American Electric Power (NYSE: AEP).

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.