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OHIO SUPREME COURT RULES ON COLUMBUS SOUTHERN POWER RATE APPEAL

 COLUMBUS, Ohio, Nov. 3 /PRNewswire/ -- The Ohio Supreme Court today ruled in a 4-3 decision that Columbus Southern Power Company, a unit of American Electric Power Company, Inc. (NYSE: AEP), is not entitled to recover through electric rates a substantial portion of construction costs for the Wm. H.
Zimmer generating plant near Cincinnati. However, the court also ruled that the Public Utilities Commission of Ohio lacked jurisdiction to impose the phase-in of rates the PUCO ordered for Columbus Southern Power Company.
 "We are disappointed that a majority of the court disallowed $165 million of spending on the Zimmer plant," said Carl Erikson, president of Columbus Southern Power Company. "However, we are pleased that the court confirmed our belief that the company has the right to place the entire approved rate increase into effect." He pointed out that the company had favored a phased-in increase only if the full amount of the proposed increase had been approved by the PUCO.
 Erikson said the company must study the court's ruling to determine how Columbus Southern Power will respond to today's ruling, as well as the ruling's effect on customer bills and the financial condition of Columbus Southern Power.
 AEP has acknowledged previously that disallowance of costs related to the construction of Zimmer would represent a writeoff of approximately $145 million after taxes.
 A 1985 agreement among Ohio regulators, other interested parties and the owners of Zimmer -- Cincinnati Gas & Electric Co., Dayton Power & Light and Columbus Southern Power -- resulted in a writeoff of expenses related to nuclear construction. On behalf of the plant owners, AEP Service Corporation completed the conversion of Zimmer to a 1,300- megawatt coal-fired plant under the cost cap called for by the 1985 agreement, which was endorsed by the PUCO.
 A May 12, 1992 PUCO ruling put into place a three-year phased-in rate increase of $123 million, a reduction of $79 million, or 40 percent, from the proposed increase of $202 million.
 In its appeal of that PUCO ruling, Columbus Southern Power argued that the PUCO unlawfully modified the 1985 Stipulation and Recommendation that paved the way for the conversion of Zimmer from a nuclear to coal-fired powerp?lant.
 -0- 11/3/93
 /CONTACT: Luke M. Feck, senior vice president, public affairs, of American Electric Power, 614-223-1650/
 (AEP)


CO: Columbus Southern Power ST: Ohio IN: UTI SU:

BM -- CL030 -- 0335 11/03/93 17:10 EST
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Publication:PR Newswire
Date:Nov 3, 1993
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