Office of the Ohio Consumers' Counsel

Consumers’ Counsel Message

The rising economic challenges of 2008 have had a direct impact on Ohio’s 4.5 million residential utility consumer households with filings for rate increases by all major investor-owned utility companies. A recordhigh number of households experienced disconnections, and the ushering in of new regulations promised substantial increases and less consumer safeguards on the horizon. On the positive side, the state legislature moved Ohio to the forefront by passing legislation on alternative energy that will provide customers with tools to manage their consumption.

Our work and accomplishments this year underscore the wisdom of the Ohio General Assembly when it established the Office of the Ohio Consumers’ Counsel (OCC) more than 32 years ago and last year returned our ability to handle complaints on residential consumers’ bills.

A steadily deteriorating economy has left thousands of Ohioans without jobs or struggling to make ends meet. While many have had their homes foreclosed altogether, more than 425,000 homes in Ohio – or close to one in 10 – experienced a disconnection of their utility service. This is a deeply troubling statistic and one which our office, particularly our customer service staff, is working each day to reduce. This also places a particularly high priority on the OCC’s overall advocacy for reasonable rate-making by our utilities. Keeping Ohioans in their homes and able to pay their bills is critical to turning our state toward a healthier financial direction. In last year’s Annual Report, we stated that, “In many ways, 2007 was the harbinger of changes in the wind that will continue through 2008.” That statement certainly held true.

The year also brought great change in the electric industry with the passage and implementation of Amended Senate Bill 221. The new law changes the way state-regulated electric utilities are structuring their rates. Following the passage of Am. SB 221, the four major electric utilities, American Electric Power, FirstEnergy, Duke Energy Ohio, and Dayton Power & Light, filed three-year proposals to restructure their customers’ rates with the Public Utilities Commission of Ohio (PUCO). Under compressed timelines, the OCC’s Analytical and Legal teams worked tirelessly to produce savings for customers by identifying where customers were being overcharged and representing them in cases before the PUCO.

Am. SB 221 also mandates that new energy efficiency and renewable energy standards be achieved – the provision of which the OCC believes will be the keystone to Ohioans’ energy future. The OCC and other stakeholders were active in negotiations that obtained these key provisions that make Ohio one of America’s leading states in the transition to cleaner and more efficient uses of energy technology.

When I first took office in 2004, I put forth a demanding set of goals and established a plan of action for the OCC that included ensuring the use of the renewable power portion of Ohio’s energy portfolio. On behalf of residential utility consumers, I am pleased that our state plans are moving in that direction.

The OCC also obtained consumer protections and safeguards in the legislation, including the requirement that a comparison between a regulated and a marketdetermined rate occur for each utility to ensure that customers receive the lower of the two pricing mechanisms; the removal of a provision that would have allowed utilities to recover a form of stranded costs in perpetuity at a very high cost to consumers; and the requirement of a prudence standard when reviewing the pass-through costs to consumers.

Completion of the new electric policy was just the beginning of the work undertaken by the OCC to protect consumers’ interests. While the PUCO was given statutory authority to develop rules for implementation of the new law, the OCC helped create and lead Ohio Consumers and Environmental Advocates (OCEA), a group of advocacy organizations that made joint recommendations on the content of the rules.

The OCC Communications staff, in partnership with other OCEA member agencies, conducted forums throughout Ohio educating electric consumers about the new legislation and encouraging citizens to participate in local public hearings.

Not all of the activity in state-regulated utilities was limited to the electric industry in 2008. The natural gas industry was embroiled in debate over a major change in the PUCO-supported Straight Fixed Variable structure of distribution rates that with the support of other advocacy groups, the OCC, through careful analysis and dogged litigation, vigorously opposed. The OCC opposed the SFV because it increased the customer charge dramatically, thereby reducing the opportunity for customers to save money through conservation, among other reasons.

The OCC and other parties negotiated agreements in rate cases filed by all four of Ohio’s natural gas utilities, Dominion East Ohio Gas, Columbia Gas of Ohio, Vectren Energy Delivery of Ohio, and Duke Energy. The agreements reduced the rate increase requests by nearly half and included increased stakeholder funding of the design and implementation of “demand-side management” programs. These initiatives are designed to help customers reduce their natural gas usage by using more energy-efficient appliances and weatherizing their homes. The OCC and its partners also achieved success in these cases by negotiating efforts to provide payment assistance to lower-income residents.

The OCC also advocated for consumer protections and comparably priced alternatives in the telecommunications industry and opposed efforts by the industry to dilute safeguards contained in Ohio’s Minimum Telephone Service Standards. The agency vigorously opposed efforts in the telecommunications industry to achieve “alternative regulation,” which would enable companies to raise rates on basic dial-tone service by claiming competition in areas where there was, according to OCC testimony, little to none. Our agency also continues to advocate for the expansion of reasonably priced broadband service throughout Ohio by participating on the Outreach Subcommittee of the Ohio Broadband Council and lobbying for funds to support the expansion of this technology.

In the water industry, service quality and billing issues continued to be the concern of the OCC as companies such as Aqua Ohio and Ohio American Water petitioned the PUCO to approve higher rates. The OCC worked with local neighborhood groups and held public forums to better understand consumers’ water issues and advocate on their behalf before the PUCO.

As we look toward the challenges that await residential utility consumers in 2009, I would like to thank Gov. Ted Strickland and the General Assembly for their support of the OCC and our mission. I would also like to thank the staff of the OCC for its tireless dedication in advocating for and representing residential utility consumers in their daily work throughout Ohio and in state and federal proceedings. I also want to express my appreciation to the members of the OCC Governing Board, who dedicate themselves to leading and guiding the OCC in its vision. Finally, I want to thank the thousands of Ohio consumers who have attended public hearings, written letters, and have expressed their opinions to help shape our state regulations on utility pricing and policies. I am proud to work with and on behalf of each of you every day and look forward to the success that awaits us in the future.

Home Mission and Vision Chairman's Message

OCC has had to cancel many of its services, including its consumer call center, due to recent budget cuts. We realize you may continue to need assistance with your utility services. OCC's website provides free access to publications and resources.

You may seek assistance with utility complaints from the Public Utilities Commission of Ohio: 800-686-7826. For complaints about non-utility related services, you may call the Ohio Attorney General at 800-282-0515.