This excerpt taken from the AEP 10-K filed Feb 28, 2008.
Indiana: I&M provides retail electric service in Indiana at bundled rates approved by the IURC, with rates set on a cost-of-service basis. In January 2008, I&M filed for an increase in its Indiana base rates of $82 million based on a return on equity of 11.5% and a September 30, 2007 test year. The base rate increase includes a $69 million reduction in depreciation. The filing requests trackers for certain variable components of the cost of service including additional PJM costs, reliability enhancement costs, demand side management/energy efficiency costs, off-system sales margins and net environmental compliance costs. The trackers would increase annual revenues by $46 million. I&M proposes to share 50% of an estimated $96 million of off-system sales margins with ratepayers with a guaranteed minimum of $20 million. A decision is expected from the IURC in early 2009.