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PSC member: Utilities' returns may be set too high

Published on NewsOK Modified: December 15, 2012 at 2:20 pm •  Published: December 15, 2012

MONTGOMERY, Ala. (AP) — A member of the Alabama Public Service Commission said he's concerned double-digit financial returns provided for three large utilities may be too high, and he wants the commission to consider changing them.

Commissioner Terry Dunn said he wants the three-member commission to vote at its next meeting Jan. 8 to conduct a formal review of the rate of return on equity that the PSC has set for Alabama Power, Alabama Gas and Mobile Gas. If approved, it could have an impact beyond customers' bills.

Dunn said in a statement that if he is successful, he will enter the process with an open mind.

"But let's be plain," he said. "My concern is that the ranges are too high, not that they're too low."

However, other commissioners indicated Dunn isn't likely to get a formal review.

Commission President Twinkle Andress Cavanaugh called Dunn's proposal "half-baked" and said the commission is not set up to conduct three formal reviews simultaneously.

At Cavanaugh's request, the commission voted unanimously earlier this month to conduct "informational meetings" with Mobile Gas to discuss rates and to post meeting notices on its website so the public can attend. She said she wants the PSC to proceed to other companies one at a time after Mobile Gas is finished.

She said Friday taking one company at a time "offers the best method for accountability and transparency for consumers."

Commissioner Jeremy Oden said focusing PSC staff and its limited resources on one company at a time will yield better results.

"Being right is more important than finishing first," he said.

Dunn's spokesman, David Rountree, said the PSC reviews natural gas companies every few years, and meetings about Mobile Gas would have occurred in 2013 with or without Cavanaugh's request. He said informational meetings amount to representatives of a utility negotiating with PSC staff.

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