JACKSON — Northern District Public Service Commissioner Brandon Presley wants the utility regulator to investigate whether some electric power associations are holding money they should refund to their member-owners.
Presley, a Democrat, said yesterday that he plans to ask the Public Service Commission at its meeting today to launch a formal inquiry. Michael Callahan, CEO of the Electric Power Associations of Mississippi, pledged to work with the commission to examine the issue.
Mississippi state law requires the cooperative entities to give back unneeded cash, stating “revenues and receipts not needed for these purposes shall be returned to the members, by the reimbursement of membership fees, or by way of general rate reductions, as the board may decide.”
Presley said the commission has the power to enforce that law.
Jointly, the 25 cooperatives are the largest providers of electricity in Mississippi, serving about 762,000 customers. That’s more than Entergy Mississippi and Mississippi Power Co. combined.
The associations reported to the commission that they had accumulated funds of $161.8 million in the latest years for which they had filed financial reports. Seven said they gave back funds, including $13.3 million from Coast EPA, $11.4 million from Singing River EPA, $8.8 million from Pearl River Valley EPA, $7.6 million from Dixie EPA, $3.9 million from Delta EPA, $1.8 million from Magnolia EPA and $200,000 from Southwest Mississippi EPA.
None of those cooperatives buy power from the federally-owned Tennessee Valley Authority. TVA cooperatives are only allowed to make rate reductions, and can’t give membership refunds.
Presley said later yesterday that those figures, as filed by the cooperatives, may not be accurate.
He said cooperatives should be allowed to retain some money for future emergencies, but said the questions underscore the need for a thorough review.
“There may be a rainy day fund, but I have a hard time believing customers are not owed money,” he said.
Cooperatives have clashed with the commission recently, saying the commission was overstepping its limited regulator power when the PSC ordered them to adopt energy efficiency plans. But they were diplomatic yesterday.
“I have talked with the commissioner in regards to the manner in which our electric cooperatives manage their capital credits,” Callahan said in a statement. “We look forward to working with him and others in verification of the information released and addressing his concerns.”
Presley said cooperatives hold too much cash nationwide, pointing to a 2009 article that U.S. Rep Jim Cooper, D-Tenn., wrote for the Harvard Journal on Legislation. That article stated that cooperatives nationwide had $31 billion in built-up equity and suggested they needed to give back 10 percent to 30 percent of that amount.
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