Shreveport, La.-based Southwestern Electric Power Co., which provides electric power to approximately 1,700 customers in and around Eureka Springs, announced Wednesday, June 29, that the Arkansas Public Service Commission has approved a base rate increase for SWEPCO customers in Arkansas, as well as an interim fuel adjustment for the 2021 winter storm fuel recovery cost.
SWEPCO residential customers in Arkansas using 1,000 kilowatt-hours will see a total increase of approximately $13.02 per month on their bill, the company said in a news release announcing the rate increase. The increase includes a 9.49 percent base rate increase, which makes up approximately $10.57 per month for an Arkansas residential customer using 1,000 kilowatt-hours.
The total bill also includes an adjustment in the Energy Cost Recoveryrate, making up approximately $2.45 per month of the increase for Arkansas residential customers using 1,000 kilowatt-hours. For commercial, industrial, municipal and lighting rate classes, the impact of the new rates varies by rate class and usage characteristics. The new rates begin with bills issued June 29 for the first billing cycle of July.
In its release, SWEPCO says the new base rate reflects investments in reliability and improvements to the resiliency of the power grid and cleaner power generation, including the construction and purchase of three wind facilities at the North Central Energy Facilities in Oklahoma. All three wind facilities are in commercial operation, with the third and largest facility beginning operation in March 2022.
“We understand customers have concerns regarding increases in energy costs,” said Malcolm Smoak, SWEPCO president and chief operating officer. “We believe the best way to hold down fluctuating cost drivers, such as natural gas, is to invest in a diverse energy mix. The fuel savings and tax credits SWEPCO gains with the addition of NCEF help to offset the cost of these facilities, which results in continued long-term savings to customers.”
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 passed through to customers with no profit to the company.
SWEPCO filed the base rate request with the public service commission in July 2021. The APSC decision authorized an annual increase of $48.7 million on May 23 and issued a final order on June 29.
The company expects the fuel recovery costs related to the winter storm to decline in 2023 and in the following years.
