Opposing groups all testify against electric rate reform bill

In instance of rare agreement, utilities and consumers’ office find different things to criticize in Senate bill



AES Ohio, Duke Energy, the Ohio Manufacturing Association and the Office of the Ohio Consumers’ Counsel all find themselves on rare common ground when it comes to opposing a bill that would change how Ohio electric utilities set rates.

On Tuesday, they all testified against Senate Bill 102 as currently drafted.

Often, the Ohio Consumers’ Counsel’s office opposes utilities when they seek to raise rates, and the office has long been skeptical of electric security plans (ESPs) — plans that guide how utilities operate and seek to stay profitable, an effort to balance grid investments and the return on those investments. Such plans have been a feature of Ohio energy law since 2008.

But on SB 102, the office and some utilities appear to be at least in partial agreement, perhaps for different reasons.

“The bill re-writes much of Ohio’s electric utility regulatory structure, creating uncertainty and risks for both customers and utilities,” Chris Hollon, AES Ohio senior counsel, testified Tuesday.

In general, the Ohio consumers’ counsel views the bill as expensive, subjecting consumers to add-on charges known as “riders.” SB 102′s “detriments for consumers outweigh its benefits,” Maureen Willis, the consumers’ counsel’s acting legal director, said in testimony shared with this newspaper.

The proposed legislation fails to enact a “robust regulatory framework” and contains provisions that hurt consumers and development, testified Steve Nourse, vice president, legal, for Columbus-area utility American Electric Power.

One provision is language that raises the “price to compare” of the SSO or “standard service offer,” the default price Ohio consumers can use to compare the cost of one utility’s service against another, he testified. The bill would force state regulators to add what Nourse called “ill-defined indirect costs” to the SSO price.

“This legislatively mandated bill increase that will fall disproportionately on residential customers,” Nourse testified.

“It’s rare that the consumers’ counsel and AEP would be in agreement that this legislation would benefit big industrial customers and energy marketers to the detriment of residential consumers,” the counsel said in a statement to this news outlet. “Instead of enhancing energy marketer profits at utility consumer expense, the legislation should ban marketer ,door-to-door sales and enact other consumer protections.”

The consumers’ office also said it would be a long time before the bill’s changes took effect.

Dayton-area utility AES Ohio is nearing the end of its latest application process for a new ESP. Matt Schilling, a spokesman for electric utility regulator Public Utilities Commission of Ohio, said Tuesday that in AES Ohio’s pending case, reply briefs were filed June 5. The next step is for a PUCO decision, for which there is no precise timeframe, he added.

Meanwhile, the latest round of ESP applications continues for other utilities. When it comes to AEP’s and First Energy’s proposed ESPs, those would be in effect for three to 10 years, Willis testified. “So, even if the bill’s approach to ratemaking were good for consumers, it will not have an effect on ending electric security plans until the 2030′s for AEP and FE.”

And Willis contends that the bill would allow refunds of illegal utility charges for a very limited time period, only after a court reversal of state regulators on such charges.

However, the office likes how the plan allows parties to conduct legal discovery or questioning of PUCO staff. The PUCO has shielded staff from discovery, according to the consumers’ counsel.

An earlier version of SB 102 was HB 317 last session which did not have the votes to pass in a lame-duck session, the office said.

A message seeking comment was left at the office of Ohio Sen. Shane Wilkin, primary sponsor of SB 102.

Wilkin, R-Hillsboro, also was a co-sponsor of Ohio House Bill 6, the controversial 2019 bill seen as a bailout of Ohio nuclear power plants.

About a year after HB 6′s passage, the FBI arrested then-House Speaker Larry Householder and several allies, accusing them of conspiring to take bribes from FirstEnergy Corp. in exchange for passing the bill. In March this year, a federal jury convicted Householder and former Ohio Republican Party chair Mathew Borges of participating in a racketeering conspiracy.

They are to be sentenced next week.

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