ATC to pass on savings from lowered corporate tax rate to customers early
FERC approved request to modify 2018 transmission rates, benefitting customers
American Transmission Co. has received permission from the Federal Energy Regulatory Commission to modify certain provisions of the Midcontinent Independent System Operator Tariff, which determines how transmission customers are charged for transmission services. The waiver granted by FERC allows transmission customers to benefit sooner from the lowered corporate tax rate implemented in the Tax Cuts and Jobs Act, which reduced corporate tax rates from 35 percent to 21 percent. The new corporate tax rate will result in approximately $50 million in savings to ATC transmission customers in 2018 for both network and regional transmission costs.
MISO requires transmission rates for each year to be set in the fall of the previous year, and ATC’s 2018 transmission rates were established before the Tax Cuts and Jobs Act went into effect Jan. 1, 2018. ATC voluntarily petitioned FERC for this waiver to pass the savings resulting from the tax rate reduction to transmission customers at the earliest date possible. Without the waiver, ATC customers would have had to wait until 2019 for the corporate tax reduction to be reflected in their rates and the savings refunded.
ATC, along with other transmission owners in MISO, filed the petition on Feb. 1, 2018, and FERC approved the waiver on March 15, 2018. ATC network transmission rates reflecting the new corporate tax rate will be implemented for the March billing cycle and ATC customers will receive billing adjustments for January and February in April.