Kentucky AG appeals decision to replace Louisa facility

By Bryan Cohen | Dec 5, 2013

FRANKFORT, Ky. (Legal Newsline) - Kentucky Attorney General Jack Conway announced an appeal Wednesday of a recent decision that would let the Kentucky Power Company acquire a West Virginia coal plant to replace the Louisa-based Big Sandy facility.

The Kentucky Public Service Commission approved a Kentucky Power proposal on October 7 that would allow it to buy a 50 percent interest in the Moundsville, W.Va.-based Mitchell Generating Station for an estimated $536 million. The PSC accepted Kentucky Power's assertion that the acquisition would cost less than retrofitting its Big Sandy coal-fired unit with environmental controls. Conway did not join the partial settlement and stipulation between Kentucky Power and the PSC.

Conway's appeal seeks to vacate and set aside the PSC's findings on multiple legal grounds.

"The recent ruling by the Kentucky Public Service Commission approving this transaction will place more than a half a billion dollars into Kentucky Power's rate base and will ultimately raise consumers' electric rates by more than 20 percent," Conway said. "It will also transfer energy production to a neighboring state and leave Kentucky consumers paying the bill. That's just not right."

Conway alleged the findings of the PSC were unlawful and unreasonable because they relied on evidence that could not be independently verified.

"The analysis used by Kentucky Power and accepted without independent verification by the commission is simply an apples to oranges comparison and is not a reliable basis for the commission's decision," Conway said. "The commission should seek additional, independent information, if it is going to raise electric rates for consumers and eliminate Kentucky jobs."

Conway also alleged the commission failed to consider the economic feasibility of the plan and neglected Kentucky's public policy interests.

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