HomeMy WebLinkAbout226-21 RESOLUTIONF FA1'FTTF
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113 West Mountain Street
Fayetteville, AR 72701
(479) 575-8323
Resolution: 226-21
File Number: 2021-0720
SOUTHWESTERN ELECTRIC POWER COMPANY TO INCREASE RATES:
A RESOLUTION TO AUTHORIZE THE CITY ATTORNEY TO FILE A MOTION TO
INTERVENE ON BEHALF OF THE CITY OF FAYETTEVILLE IN ARKANSAS PUBLIC
SERVICE COMMISSION PROCEEDING 21-070-U AND OPPOSE THE APPLICATION OF
SOUTHWESTERN ELECTRIC POWER COMPANY TO INCREASE ITS RATES
WHEREAS, on July 23, 2021, Southwestern Electric Power Company ("SWEPCO") filed an
Application for General Change in Rates and Tariffs with the Arkansas Public Service Commission;
and
WHEREAS. S WEPCO's proposed rate change would result in an electricity cost increase to the City
of Fayetteville government. residents, businesses, and institutions of more than $10.000,000.00; and
WHEREAS, the City of Fayetteville is not adequately represented by any other party to SWEPCO's
rate increase proceeding as it is SWEPCO's largest municipal customer in the State of Arkansas and
S WEPCO provides approximately 74% of all electricity consumed in the City.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
FAYETTEVILLE, ARKANSAS:
Section 1: That the City Council of the City of Fayetteville, Arkansas hereby authorizes the
City Attorney to file a motion to intervene on behalf of the City of Fayetteville in Arkansas Public
Service Commission proceeding 21-070-U and oppose the application of Southwest Electric Power
Company to increase its rates.
PASSED and APPROVED on 9/14/2021
Page 1 Printed on 9/15/21
Resolution: 226-21
File Number. 2021-0720
Attest:
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Kara Paxton, City Clerk Treasure����;
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Page 2 Printed on 9115121
City of Fayetteville, Arkansas 113 West Mountain Street
Fayetteville, AR 72701
(479)575-8323
Text File
File Number: 2021-0720
Agenda Date: 9/14/2021 Version: 1 Status: Passed
In Control: City Council Meetinq File Type: Resolution
Agenda Number: A.1
SOUTHWESTERN ELECTRIC POWER COMPANY TO INCREASE RATES:
A RESOLUTION TO AUTHORIZE THE CITY ATTORNEY TO FILE A MOTION TO INTERVENE
ON BEHALF OF THE CITY OF FAYETTEVILLE IN ARKANSAS PUBLIC SERVICE COMMISSION
PROCEEDING 21-070-U AND OPPOSE THE APPLICATION OF SOUTHWESTERN ELECTRIC
POWER COMPANY TO INCREASE ITS RATES
WHEREAS, on July 23, 2021, Southwestern Electric Power Company ("SWEPCO") filed an Application for
General Change in Rates and Tariffs with the Arkansas Public Service Commission; and
WHEREAS, SWEPCO's proposed rate change would result in an electricity cost increase to the City of
Fayetteville government, residents, businesses, and institutions of more than $10,000,000.00; and
WHEREAS, the City of Fayetteville is not adequately represented by any other party to SWEPCO's rate
increase proceeding as it is SWEPCO's largest municipal customer in the State of Arkansas and SWEPCO
provides approximately 74% of all electricity consumed in the City.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
FAYETTEVILLE, ARKANSAS:
Section 1: That the City Council of the City of Fayetteville, Arkansas hereby authorizes the City
Attorney to file a motion to intervene on behalf of the City of Fayetteville in Arkansas Public Service
Commission proceeding 21-070-U and oppose the application of Southwest Electric Power Company to
increase its rates.
City of Fayetteville, Arkansas Page 1 Printed on 911512021
Peter Nierengarten
Submitted By
City of Fayetteville Staff Review Form
2021-0720
Legistar File ID
9/14/2021
City Council Meeting Date - Agenda Item Only
N/A for Non -Agenda Item
9/10/2021 SUSTAINABILITY/RESILIENCE (631)
Submitted Date Division / Department
Action Recommendation:
Staff recommends intervening in Arkansas Public Service Commission docket: 21-070-U, in the matter of the
application of Southwestern Electric Power Company for approval of a general change in rates and tariffs.
Account Number
Project Number
Budgeted Item?
Does item have a cost?
Budget Adjustment Attached?
Budget Impact:
Current Budget
Funds Obligated
Current Balance
Item Cost
Budget Adjustment
Remaining Budget
Fund
Project Title
V20210527
Purchase Order Number: Previous Ordinance or Resolution #
Change Order Number: Approval Date:
Original Contract Number:
Comments:
CITY OF
FAYETTEVILLE
ARKANSAS
MEETING OF SEPTEMBER 14, 2021
TO: Mayor and City Council
THRU: Susan Norton, Chief of Staff
FROM: Peter Nierengarten, Environmental Director
DATE: September 7, 2021
CITY COUNCIL MEMO
SUBJECT: Southwestern Electric Power Company (SWEPCO) Rate Case Intervention
RECOMMENDATION:
Staff recommends intervening in Arkansas Public Service Commission docket: 21-070-U, in the
matter of the application of Southwestern Electric Power Company for approval of a general
change in rates and tariffs.
BACKGROUND:
Southwestern Electric Power Co. (SWEPCO) is one of two utilities providing electricity within the
City of Fayetteville. In 2020, SWEPCO provide approximately 795 million kWh of electricity to
residents, businesses and other institutions in Fayetteville, accounting for 74% of electricity
consumed in the City.
On July 23, 2021, SWEPCO submitted a request to the Arkansas Public Service Commission to
update its prices. The company seeks recovery of ongoing operation and maintenance ("O&M")
and capital for its generation units associated with several utility distribution and generation
upgrades, including:
• New wind power generation facilities in Oklahoma
• Upgrades to the Flint Cleek Coal Plant to comply with the U.S. EPA Coal Combustion
Residual (CCR) and Effluent Limitations Guidelines (ELG) rules
• Transmission & distribution improvements to increase reliability of service to customers
If approved, new rates would likely go into effect by the middle of 2022. A Fayetteville residential
customer using 1,000 kilowatt-hours per month would see a total bill of $130.20, an overall bill
increase of $18.89 per month, or about 17%. Commercial, industrial and public customers
would see an 8% rate increase.
DISCUSSION:
The Arkansas Public Service Commission allows any person or entity whose interest may be
directly affected by Commission action to intervene as a party to any docket. A petition to
intervene shall contain:
• The nature of the petitioner's interest in the proceeding
Mailing Address:
113 W. Mountain Street www.fayetteville-ar.gov
Fayetteville, AR 72701
• A demonstration that the petitioner's interests are not adequately represented by any
other party
• The specific objection to the applicant's proposal
• Any other reasonable information
Other affected entities who have submitted petitions to the Arkansas Public Service
Commission to intervene in this rate case include the University of Arkansas System, Walmart
Inc. and the Sierra Club. The deadline to submit intervene in this rate case is 4:30 pm on
Tuesday, September 21, 2021.
BUDGET/STAFF IMPACT:
The proposed SWEPCO rate increase would have a direct budgetary impact of approximately
$80,000 per year for City of Fayetteville Government electricity costs and over $10M per year in
additional electricity cost for the residents, businesses and other institutions in Fayetteville.
Attachments:
SWEPCO News Release
SWEPCO REQUESTS NEW ARKANSAS RATES
July 23, 2021
SHREVEPORT, La., July 23, 2021— Southwestern Electric Power Co. (SWEPCO), an American Electric
Power (Nasdaq: AEP) company, today submitted a request to the Arkansas Public Service Commission
(APSC) to update its prices. The company seeks to recover environmental and resiliency costs associated
with providing customers cleaner and more reliable energy.
"We have made significant investments in wind -powered generation, specifically with the North Central
Energy Facilities (NCEF) project," said Malcolm Smoak, SWEPCO president and chief operating officer.
"It's a project that has environmental and economic benefits for SWEPCO's customers, saving an
estimated $2 billion over the next 30 years."
The APSC unanimously approved the NCEF project in May 2020.
With no fuel cost for wind, NCEF lowers SWEPCO's overall fuel cost for power generation. This fuel
savings and federal Production Tax Credits more than offset the cost of the new facilities, resulting in
net long-term savings to customers.
One of three NCEF wind facilities is now in commercial operation. The second and third facilities will
begin operations later this year and early 2022, respectively. Arkansas customers get 268 megawatts
(MW) of SWEPCO's total purchase of 810 MW.
The $85 million request also includes recent investments in transmission and distribution facilities and
reflects costs to operate and maintain equipment that delivers power to customers. It also establishes
new tariffs for electric vehicles, lighting and other measures.
If approved, new rates would likely go into effect in the first billing cycle of June 2022. An Arkansas
residential customer using 1,000 kilowatt-hours per month would see a total bill of $130.20, an overall
bill increase of $18.89 per month, or about 17%. This total includes SWEPCO's 2021 winter storm costs,
which are about $7.72 per month for a residential customer using 1,000 kilowatt-hours per month.
Base rates refer to the costs of building, maintaining and operating SWEPCO's electric system, including
power plants, transmission and distribution lines and facilities to serve customers. Base rates do not
include the fuel portion of the customer's bill, which pays for fuel and purchased power and is a direct
pass -through to customers.
About Southwestern Electric Power Co. (SWEPCO)
SWEPCO, an American Electric Power (Nasdaq: AEP) company, serves more than 543,000 customers in
northwest and central Louisiana, northeast Texas and the Texas Panhandle, and western Arkansas.
SWEPCO's headquarters are in Shreveport, La. News releases and other information about SWEPCO can
be found at SWEPCO.com. Connect with us at Facebook.com/SWEPCO, Twitter.com/SWEPCOnews,
Instagram.com/swepco, Youtube.com/SWEPCOty, LinkedIn.com/company/swepco and
SWEPCOConnections.com.
About American Electric Power (AEP)
American Electric Power, based in Columbus, Ohio, is powering a cleaner, brighter energy future for its
customers and communities. AEP's approximately 16,800 employees operate and maintain the nation's
largest electricity transmission system and more than 223,000 miles of distribution lines to safely deliver
reliable and affordable power to 5.5 million regulated customers in 11 states. AEP also is one of the
nation's largest electricity producers with approximately 30,000 megawatts of diverse generating
capacity, including more than 5,600 megawatts of renewable energy. The company's plans include
growing its renewable generation portfolio to approximately 50% of total capacity by 2030. AEP is on
track to reach an 80% reduction in carbon dioxide emissions from 2000 levels by 2030 and has
committed to achieving net zero by 2050. AEP is recognized consistently for its focus on sustainability,
community engagement, and diversity, equity and inclusion. AEP's family of companies includes utilities
AEP Ohio, AEP Texas, Appalachian Power (in Virginia and West Virginia), AEP Appalachian Power (in
Tennessee), Indiana Michigan Power, Kentucky Power, Public Service Company of Oklahoma, and
Southwestern Electric Power Company (in Arkansas, Louisiana, east Texas and the Texas Panhandle).
AEP also owns AEP Energy, which provides innovative competitive energy solutions nationwide. For
more information, visit aep.com.
APSC FILED Time 9/27/2021 8 00 23 AM Recvd 9/25/2021 12 37 08 PM Docket 21 070-U-Doc 80
BEFORE THE
ARKANSAS PUBLIC SERVICE COMMISSION
IN THE MATTER OF THE APPLICATION )
OF SOUTHWESTERN ELECTRIC POWER ) DOCKET NO.21-070-U
COMPANY FOR APPROVAL OF A GENERAL )
CHANGE IN RATES AND TARIFFS )
RESPONSE TO PETITION TO INTERVENE OF THE CITY OF FAYETTEVILLE
Southwestern Electric Power Company has no objection to the Petition to Intervene filed
September 15, 2021 by the City of Fayetteville
Respectfully submitted,
lsl Stephen K Cu
,man
Stephen K Cuffman (75026)
Mitchell S Dennis (2017110)
Gill Ragon Owen, P.A.
425 West Capitol Avenue
Suite 3800
Little Rock, Arkansas 72201
(501) 376-3800
David R. Matthews (76072)
MATTHEWS, CAMPBELL, RHOADS
McCLURE & THOMPSON, P A.
119 South Second Street
Rogers, Arkansas 72756
(479) 636-0875
Attorneys for Southwestern Electric Power Company
APSC FILED Time: 9/24/2021 3:32:13 PM: Recvd 9/24/2021 3:31:38 PM: Docket 21-070-U-Doc. 79
BEFORE THE ARKANSAS PUBLIC SERVICE COMMISSION
IN THE MATTER OF THE )
APPLICATION OF SOUTHWESTERN )
ELECTRIC POWER'COMPANY FOR ) DOCKET NO 21-070-U
APPROVAL OF A GENERAL CHANGE )
IN RATES AND TARIFFS )
GENERAL STAFF'S- RESPONSE TO
THE CITY OF FAYETTEVILLE,-ARKANSAS'
PETITION TO INTERVENE'
Comes now the General Staff ("Staff') of the Arkansas Public Service
Commission ("Commission") and for its Response to the City of Fayetteville, Arkansas
("Fayetteville") Petition to Intervene ("Petition") states as follows.
l
1 On July 23, 2021, Southwestern Electric Power Company ("SWEPCO")
filed an Application for approval of a general change in rates and tariffs.'
2. On September 15, 2021, Fayetteville submitted its Petition in accordance
with the Commission's Rules of Practice and Procedure ("RPP") 4 02.2
3 RPP 4 02 sets forth the intervention requirements for any person or entity
seeking full intervenor status in a Commission proceeding RPP 4 02(a) provides that:
Any person whose interest may be .directly affected by
Commission action and whose interest is not adequately
represented by other parties may petition the Commission
c for leave to intervene as a- Party in any Docket.
(1) Contents of Petition to Intervene
Every petition to intervene shall be in writing and
contain r
(A) .a clear and concise statement of the nature of the
right or interest of the Petitioner in the proceeding
' SWEPCO's Application, (Doc. 33)
2 Fayetteville's Petition to Intervene, (Doc. 77).
APSC FILED Time: 9/24/2021 3:32:13 PM: Recvd 9/24/2021 3:31:38 PM: Docket 21-070-U-Doc. 79
r.
which entitles it to participate and which will be
directly affected by the Commission's action,
(B) a. demonstration that the Petitioner's interests. are
not adequately represented by any other Party to the
proceeding, _
(C) the specific objections, if any, of the Petitioner to
the Applicant's proposal(s),
(D) the grounds and issues of fact -and law upon
which Petitioner wishes to be heard, and
(E) any other reasonable information which may be
required by Rule or order
4 In satisfaction of RPP 4 02(a)(1)(A), Fayetteville states in its Petition that:
The relief requested by SWEPCO will directly affect
Fayetteville, as well as its residents, businesses, and
institutions, through increased electric rates Accordingly,
Fayetteville has, an interest in this proceeding which entitles
it to participate and which will be directly affected by the
Commission's actions 3
5 In satisfaction of RPP 4 02(a)(1)(B), Fayetteville asserts that:
The nature of Fayetteville's position as SWEPCO's largest
municipal customer in Arkansas is unique and Fayetteville is
'not adequately represented by any other Party to the
proceeding' Rule 4 02(a)(1)(B) Allowing Fayetteville to
intervene in this proceeding will serve the public interest by
apprising the Commission of the interests of a large
municipal customer 4
6 Pursuant to RPP 4 02(a)(1)(D), Fayetteville states "Fayetteville has not yet
finalized its position in this docket and- respectfully requests leave to fully articulate its
interests in any additional testimony and/or comments filed -in this docket."5
3 Id. at 1-2, ¶ 3.
4 Id. at 2, 14
5 Id. at 2, 15
APSC FILED Time: 9/24/2021 3:32:13 PM: Recvd 9/24/2021 3:31:38 PM: Docket 2.1-070-U-Doc. 79
7 Additionally, Fayetteville has met the deadline for intervention set forth in
RPP 4 02(a)(2)
8 Fayetteville has yet to identify specific grounds or issues of fact and law
upon which it wishes to be heard pursuant to Rule 4 02(a)(1)(D) ofthe Commission's
RPP Since Fayetteville has stated that "the relief requested by SWEPCO will directly
affect Fayetteville, as well as its residents, businesses, and institutions, through
increased electric rates", Staff concludes that granting Fayetteville's Petition is
consistent with the RPPs and in the public interest to the extent Fayetteville represents
its interests as SWEPCO's largest municipal customer 6 Staff asserts that it and the
Arkansas Attorney General's Office will adequately represent Fayetteville's residents,
businesses, and institutions
WHEREFORE, Staff respectfully requests that Fayetteville's Petition to Intervene
be granted for the limited purpose of representing itself as the largest municipal
customer, and for all other relief to which it may be entitled
Respectfully submitted,
GENERAL STAFF OF THE
ARKANSAS PUBLIC SERVICE
COMMISSION
By, /s/ Elizabeth LaRue -Grigg
Elizabeth LaRue -Grigg
Ark Bar No 03-217
6 Id., at 1-2 113 & 4 (emphasis added)
Arkansas Public Service Commission
1000 Center Street
PO Box 400
Little Rock, AR 72203-0400
T (501) 682-5443
Elizabeth.larue-grigg(a_arkansas.gov
ki
APSC FILED Time: 9/24/2021 3:32:13 PM: Recvd 9/24/2021 3:31:38 PM: Docket 21-070-U-Doc. 79
CERTIFICATE OF SERVICE
I, Elizabeth LaRue -Grigg, hereby certify that a copy of the foregoing has been
served on all parties of record via the ASPC Electronic Filing System on the 24th day of
r
September 2021 t
By- /s/ Elizabeth LaRue -Grigg
APSC FILED Time: 9/27/2021 3:12:24 PM: Recvd 9/27/2021 3:09:43 PM: Docket 21-070-U-Doc. 83
ARKANSAS PUBLIC SERVICE COMMISSION
IN THE MATTER OF THE APPLICATION OF )
SOUTHWESTERN ELECTRIC POWER ) DOCKET NO. 21-070-U
COMPANY FOR APPROVAL OF A GENERAL ) ORDER NO. 7
CHANGE IN RATES AND TARIFFS )
ORDER
On September 15, 2021, the City of Fayetteville, Arkansas (Fayetteville) filed a
Petition to Intervene (Petition) in the above Docket pursuant to Rule 4.02 of the
Arkansas Public Service Commission's (Commission) Rules of Practice and Procedure
(RPP). In support of its Petition, Fayetteville states that it is the second largest
municipal corporation in the State of Arkansas and is a large retail and municipal
streetlight customer of Southwestern Electric Power Company (SWEPCO) which
provides approximately 74 percent of all electricity consumed by Fayetteville residents,
businesses, and institutions. Petition ¶¶ 1-2 (Doc. *77).
Fayetteville additionally states that the relief requested by SWEPCO in this
Docket will directly affect Fayetteville, as well as its residents, businesses, and
institutions, through increased electric rates and that its position as SWEPCO's largest
municipal customer in Arkansas is unique and "not adequately represented by any other
Party to the proceeding." Fayetteville adds that allowing it to intervene in this
proceeding will serve the public interest by apprising the Commission of the interests of
a large municipal customer. Id. ¶¶ 3-4•
On September 27, 2021, SWEPCO filed a letter stating that it did not oppose
Fayetteville's Intervention. (Doc. *8o)
APSC FILED Time: 9/27/2021 3:12:24 PM: Recvd 9/27/2021 3:09:43 PM: Docket 21-070-U-Doc. 83
Docket No. 21-070-U
Order No. 7
Page 2 of 3
On September 24, 2021, the General Staff of the Commission filed a Response to
Fayetteville's Petition concluding that granting the Petition is consistent with the RPPs
and is in the public interest to the extent that Fayetteville only represents its interests as
SWEPCO's largest municipal customer. (Doc. #79)
Findings and Ruling of the Commission
Rule 4.02(a)(1) of the Commission's RPPs provides that a Petition to Intervene
shall contain the following:
(A) a clear and concise statement of the nature of the right or interest of
the Petitioner in the proceeding which entitles it to participate and which
will be directly affected by the Commission's action;
(B) a demonstration that the Petitioner's interests are not adequately
represented by any other Party to the proceeding;
(C) the specific objections, if any, of the Petitioner to the Applicant's
proposal(s);
(D) the grounds and issues of fact and law upon which Petitioner wishes
to be heard; and
(E) any other reasonable information which may be required by Rule or
order.
The Petition is in compliance with the requirements of RPP 4.02(a)(1).
Fayetteville has interests that will be directly affected by the Commission's action in this
Docket in that it is SWEPCO's largest municipal customer in Arkansas;' those interests
will not be adequately represented by any other Party to this proceeding; and its
intervention is in the public interest. Accordingly, for good cause shown, Fayetteville is
1 Although Fayetteville also alleges that the relief requested by SWEPCO will affect "its residents,
businesses, and institutions," Fayetteville does not provide a list of any ratepayers it proposes to represent
in accordance with RPP 3.og(f) and thus is not granted intervention to represent those entities.
APSC FILED Time: 9/27/2021 3:12:24 PM: Recvd 9/27/2021 3:09:43 PM: Docket 21-070-LI-Doc. 83
Docket No. 21-070-U
Order No. 7
Page 3 of 3
hereby granted intervention for the purpose of representing itself as a municipal
customer as a Party in this Docket.
BY ORDER OF THE COMMISSION.
This 27th day of September, 2021.
Ted J. Thomas, Chairman
Kimberly A. O'Guinn, Commissioner
Justin Tate, Commissioner
Mary Loos, Sec ary of the Commission
I hereby certify that this order, issued by the
Arkansas Public Service Commission,
has been served on all parties of record on
this date by the following method:
_U.S. mail with postaga prepaid using the
mailing address of each party as
ind, ated in the official docket file, or
Electronic mail using the emai3 address
of each party as indicated in the official
docket file.