KENTUCKY POWER SEEKING DEBT RELIEF FOR CUSTOMERS; FLEX PAY PROGRAM AND METER UPGRADES

KENTUCKY POWER SEEKING DEBT RELIEF FOR CUSTOMERS; FLEX PAY PROGRAM AND METER UPGRADES

• Company also requests approval to use accumulated federal tax balances to delay the impact of rate adjustments on customer bills until January 2022

ASHLAND, Kentucky, May 29, 2020 –With the economic situation worsened by the COVID-19 pandemic, Kentucky Power is proposing a three-step plan to help customers who have fallen behind in their electric bills. The plan includes a bill credit to eliminate past due balances for customers, a new Flex Pay program giving customers more control over their monthly electric costs and a plan to lessen the impact of a future rate adjustment.

In a filing today with the Kentucky Public Service Commission, Kentucky Power has asked for approval to provide a bill credit for customers whose accounts are more than 30 days past due as of May 28, 2020. These credits would eliminate all delinquencies for those past due amounts. Kentucky Power would utilize a portion of its accumulated tax balance from the 2017 Tax Cuts and Job Act federal tax reform program to provide these credits. 

“Our customers are facing serious economic challenges in eastern Kentucky. The pandemic has caused additional hardships for many in the region who were already struggling to make ends meet,” said Brett Mattison, Kentucky Power, president and chief operating officer. “We’re committed to providing essential power to the region in good times and bad and doing everything we can to help our customers. We have made donations to local organizations that provide essential services, and now we want to give our customers a fresh start so they can focus on keeping their families safe and healthy.”

More than 22,000 residential, commercial and industrial customers would receive a credit under the proposal. Credits would be calculated based on past due balances as of May 28, 2020. The credit would be a one-time adjustment, and customers would be responsible for any future balances accumulated between May 28 and the Commission’s approval.

Kentucky Power also is proposing an additional payment option called Flex Pay. The voluntary Flex Pay option would give customers the ability to pre-pay accounts to help them budget their monthly electricity costs. Customers participating in the Flex Pay program would not have to pay security deposits or late fees. In order to offer this program, new electric meter technology, Advanced Metering Infrastructure (AMI), would need to be installed. This system would provide customers with more information to better manage their electricity usage. The AMI systems also would enhance restoration during outages.

A proposal for Flex Pay and to install AMI will be submitted to the Commission on June 29, 2020, as part of a base rate adjustment request. 

In the base rate adjustment request, Kentucky Power will propose to delay any base rate increase that customers have to pay until January 1, 2022 by using an additional portion of the accumulated federal income tax balance to offset the increase.

“We understand the economic uncertainty that our customers are facing and have developed this multi-layered approach to give customers a break, offer them more control of their energy costs going forward and providing an additional year before seeing the impact of any rate adjustments on their bills,” Mattison said.

Complete details of the base rate adjustment request will be available June 29, 2020, when the proposal is filed with the Commission.

Kentucky Power is regulated by the Kentucky Public Service Commission (PSC) and all regulatory activity, including these proposals, must be reviewed and ruled on before the Company can proceed.

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Kentucky Power, with headquarters in Ashland, provides service to about 165,000 customers in 20 eastern Kentucky counties, including Boyd, Breathitt, Carter, Clay, Elliott, Floyd, Greenup, Johnson, Knott, Lawrence, Leslie, Letcher, Lewis, Magoffin, Martin, Morgan, Owsley, Perry, Pike and Rowan. Kentucky Power is an operating company in the American Electric Power (AEP) system. AEP, based in Columbus, Ohio, is focused on building a smarter energy infrastructure and delivering new technologies and custom energy solutions to customers. AEP’s more than 17,000 employees operate and maintain the nation’s largest electricity transmission system and more than 224,000 miles of distribution lines to efficiently deliver safe, reliable power to nearly 5.4 million regulated customers in 11 states, including Kentucky. AEP also is one of the nation’s largest electricity producers with approximately 33,000 megawatts of diverse generating capacity, including 4,200 megawatts of renewable energy. AEP’s companies includes utilities AEP Ohio, AEP Texas, Appalachian Power, Indiana Michigan Power, Kentucky Power, Public Service Company of Oklahoma, and Southwestern Electric Power Company. AEP also owns AEP Energy.

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