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Published: Sunday, 12/11/2011

Power firm tries to ease concerns


American Electric Power is offering a new rebuttal to concerns that its rate proposal might stop communities from getting benefits from electricity-buying plans.

But the message stops short of guaranteeing that the roughly 40 communities will get the discounted electricity service they hoped for. The utility is making its case as regulators have scheduled a vote on the plan for Wednesday.

At issue is part of the rate plan that places a cap of sorts on the share of customers who can get their electricity from an alternative provider. The first 21 percent of customers who choose an alternative provider will benefit from a lower price for the right to use AEP's system, a cost paid by the provider. Once the cap is met, the providers must pay a higher fee, roughly double.

An AEP report shows it has enough capacity left below the cap to serve 150,000 added households, more than the number of households in the 40 communities.

But that does not mean that the lower-cost capacity will be available to all of the communities once they go through the process of setting up the group-buying deals, which can take months.

AEP rival FirstEnergy, which hopes to serve many of those communities, said it still has concerns that AEP's plan is hostile to group-buying plans, and AEP's new statement doesn't change that. By the time the communities get their programs up and running, the discount "will be gone," said Doug Colafella, a FirstEnergy spokesman.

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