City of Cincinnati v. Public Utilities Commission

The city argues that the commission erred: (1) in determining Zimmer’s reasonable original cost, including failing to make a prudence adjustment to CG&E’s Zimmer rate base; and (2) in using a twelve-month average stock price to estimate CG&E’s cost of common equity. For the reasons which follow, we reject these arguments and affirm the commission’s order.

I. REASONABLE ORIGINAL COST

A. Equivalent Plant Standard

R.C. 4909.15 and 4909.051 require the commission to ascertain the reasonable original cost of a utility’s used and useful property for ratemaking purposes. In *526doing so in this case for…