Wind Storm Damage Could Affect Your Wallet

Monday,  November 17, 2008 6:13 PM

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COLUMBUS, Ohio — American Electric Power is expected to try to recover part of the $31 million it spent fixing lines from September's windstorm by billing customers, 10 Investigates reported.

The Sept. 14 windstorm left more than 700,000 central Ohioans without electricity, with many of them affected for a week or more.

Wind gusts hit 75 mph that day, flattening trees and mangling power lines.

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"AEP's request is like pouring salt in a wound that's still open," said Janine Migden-Ostrander of the Ohio Consumers' Counsel, the residential utility consumer advocate. 

Migden-Ostrander said that she plans to fight the AEP surcharge.

"We're going into that hearing with the notion if AEP had done what it should have been doing, it might not have incurred those costs," Migden-Ostrander said.

AEP is supposed to keep its lines in good, working order.  The maintenance includes trimming trees to keep them from crashing into lines during bad weather.  The company passes the considerable costs onto customers, 10 Investigates' Paul Aker reported.

The company said that it has done a good job but a 2006 investigative report by the Public Utilities Commission of Ohio criticized the company for failing to do enough trimming, Aker reported.

Another report said that AEP took a lot of ratepayer money to trim trees that it never got around to trimming.

Migden-Ostrander said that she thinks some of the same trees likely contributed to September's power outages.

The PUCO report said that over a nine year period, from 1992 to 2001, AEP took $88 million in inflation-adjusted dollars from ratepayers for line maintenance, including tree trimming that it did not spend.  The company, by it's under spending, allegedly banked enough to pay for three September storms, Aker reported.

"That's not correct at all," said Joseph Hamrock, the president of AEP Ohio.  "I don't even know where that number came from."

Hamrock said that PUCO is mistaken.  He said that AEP actually spent more than it billed on line maintenance.

PUCO chairman Dr. Alan Schriber heads the commission that will decide whether AEP can pass its storm costs onto customers.

Consumer advocates accuse Schriber of sometimes going too soft on AEP.  When he sat down with 10 Investigates, Schriber could not be sure whether his own organization was right about AEP under spending on maintenance.

"I've heard that (AEP) under spent and I've heard that they've overspent," Schriber said. 

PUCO recently fined AEP for longstanding problems with line maintenance.  Hamrock said that the reason lines fell into such a state is because rates have been so low.

"I think it's important to look at the total picture and understand that there's always a tradeoff between cost and reliability," Hamrock said.

Still, AEP has been able to make a healthy profit.  AEP and its parent company, serving seven states, have combined profits so far this year of $1.2 billion, up 40 percent from last year, Aker reported.

"You can't expect a business that doesn't price for those kinds of events to absorb that," Hamrock said.

An AEP spokeswoman said that it is important everyone knows that the utility last raised base rates about 13 years ago.

She also said that the company often makes other investments in the reliability of its system that were not reflected in this report.

Stay with 10TV News and 10TV.com for additional information.

More Information:

Previous Stories:

September 24, 2008:  Wind Storm Didn't Spare Cemetery, 200-Year-Old Trees
September 22, 2008:  AEP Restores Power To All But 600 Central Ohio Customers
September 22, 2008:  Customers Still Without Power In Franklin Co. Dwindle
September 21, 2008:  Fewer Than 3,000 Without Power In Franklin Co.
September 20, 2008:  AEP Plugs Away; 24,000 In Franklin County Without Power
September 19, 2008:  About 54,000 In Franklin County Still Without Power
September 18, 2008:  People Making Do Without Power
September 18, 2008:  Will AEP Customers See Surcharge For Power Restoration?
September 18, 2008:  Power Restored To 88 Percent Of Franklin County
September 17, 2008:  Families Endure Fourth Night Without Power
September 17, 2008:  Who's Responsible For Storm Damage?
September 15, 2008:  Food Safety A Concern During Power Outage
September 15, 2008:  Nearly Half Of Franklin Co. Still Without Power
September 14, 2008:  We Could Be Without Power For Days

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