Public Service Company of Oklahoma (PSO) today filed with the Oklahoma Corporation Commission (OCC) testimony in support of its Environmental Compliance Plan for meeting new, final EPA rules affecting power plant emissions and for recovery of new purchased power costs, which are part of the plan. The plan includes an agreement in principle announced in April 2012 by PSO, the State of Oklahoma, the U.S. Environmental Protection Agency and the Sierra Club.

The overall compliance plan addresses the EPA’s Regional Haze Rule (RHR) and Mercury and Air Toxics Standard (MATS), the two most significant environmental compliance regulations facing PSO.

Four of PSO’s natural gas-fired generators affected by the new rules must comply with the RHR for nitrogen oxide (NOx) emissions. This will be accomplished by installing special combustion technology to reduce NOx emissions.

Meanwhile, PSO’s coal-fired Northeastern Station (NES) Units 3&4 are subject to the RHR for nitrogen oxide emission rates and sulfur dioxide (SO2) emission rates. Under MATS, the units are subject to emission rates for mercury and other hazardous air pollutants.

As part of the plan, PSO will close NES 4 in early 2016. Meanwhile, it will install new emissions control equipment on NES 3, modify some existing equipment, increase the use of ultra-low sulfur coal, and eventually lower the unit’s operating limits. PSO will operate NES 3 until it is retired at the end of 2026.

Key elements of the filing seek OCC approval for: 1) PSO’s plan for complying with new EPA rules, 2) cost recovery for new purchased power beginning in 2016, 3) earnings on the power purchase agreement, and 4) new depreciation rates for NES 3&4.

Today’s filing does not ask any new costs be put into rates at this time.

PSO, a unit of American Electric Power (NYSE: AEP), is an electric utility company serving more than 530,000 customers in eastern and southwestern Oklahoma. With headquarters in Tulsa, PSO has 4,321 megawatts of generating capacity and provides electricity to 230 cities and towns across a service area encompassing 30,000 square miles. News releases and other information about PSO can be found on the World Wide Web at PSOklahoma.com.