As used in this subchapter:
(1)
(A) “Earned return rate” means a public utility's return on common equity for a formula rate review test period that is based on the numbers or values of the formula rate review test period and calculated by dividing the weighted earned common equity rate by the common equity ratio percentage.
(B) As used in subdivision (1)(A) of this section, “weighted earned common equity rate” means the weighted formula rate review test period cost rate for common equity minus the operating income deficiency, or excess, divided by a public utility's rate base;
(2) “Formula rate review test period” means a test period as stated in § 23-4-406 or a projected year;
(3) “Historical year” means, when using a formula rate review test period containing projections, the twelve (12) consecutive months that precede the second and any subsequent formula rate review test period;
(4) “Projected year” means the twelve (12) months following the proposed effective date under § 23-4-1205 for the first formula rate review filing and each subsequent consecutive twelve-month period; and
(5) “Target return rate” means a cost rate of common equity value as established by the Arkansas Public Service Commission in the commission's order addressing the public utility's most recent application for a general change in rates and charges.