In this issue:

• Updated rules and new electric rate options would help consumers
• First watchdog set OCC into action
• Renewable energy resources lesson #1 - wind power
• Identity theft is still an issue
• Consumers' voices were heard in telephone rules case
• Q & A: Learn about the Ohio Energy Loan Fund

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Updated rules and new electric rate options would help consumers

The ability for consumers to produce their own electricity, especially using renewable sources such as wind and solar, has recently been the topic of many news articles throughout Ohio. Earlier this year, Ohio began to review the current rules related to how consumers can generate electricity while still connecting to the local utility's system. In addition, Ohio has been exploring whether "smart meters" should be available to help customers better manage their power usage and costs.

The review being conducted by the Public Utilities Commission of Ohio (PUCO) was prompted by the federal Energy Policy Act of 2005. The act required state regulators to review and consider alternative options related to the generation of electricity, as well as the use of new technologies and renewable sources of energy. Gov. Bob Taft also requested that issues involving consumers' ability to produce their own power be made a priority for Ohio.

When consumers generate a portion of the electricity they use, some of the generation expenses can be lowered while the reliability of the electric system can increase. For example, the production of power by consumers can make more of a local utility's power available at peak times of the year (for example, very hot summer days). Additionally, if consumers use renewable sources like wind or solar, the environment will be improved and our country's energy independence enhanced.

The Office of the Ohio Consumers' Counsel (OCC) has played a key role in the review by filing extensive comments at the PUCO and working with experts on these topics who contribute to a series of technical panels held in Columbus.

The OCC believes that rule changes are needed to open the door wider for consumers to generate their own electricity. The OCC made a series of recommendations that would help remove barriers that may be preventing more Ohioans from generating power, known as "distributed generation." For instance, the rules need to be clarified to ensure that consumers can install units of their choice - as well as have the ability to have more than one unit - so long as safety and reliability are maintained. Improved rules also should be easier for residents to understand and follow, and be more uniform throughout the state.

Beyond the issue of generating power, the development of new pricing options would benefit residential consumers. Specifically, customers should be able to sign up for a rate that encourages them to adjust their use of power during times of the year when market costs are high. The rates would accurately reflect the real-time market price of electricity, which can rise and fall according to demand.

Consumers could use "smart meters" - devices that display the price of electricity - to better understand how much power actually costs during times of high demand. This information would empower customers to shift energy usage into low-priced periods, helping the reliability of the local utility's system and potentially lowering monthly bills.

Terms to know

Below are terms often used during discussions about consumers producing some of their own electricity or being provided the option of paying a real-time price for the local utility's power:

Demand response - The ability for consumers to manage their electricity based on the overall need for power. Since the price of electricity purchased by a utility can be very expensive during times of peak demand (for example, on hot summer days), programs and rates can be offered to encourage customers to use less power during these hours.

Distributed generation - When customers or utilities produce some of their own electricity from sources other than a central power plant. Rather than the utility providing all their electricity - or generation - from a central power plant, the sources of the electricity are "distributed" to homes and businesses that have installed a wind turbine, solar panel or other power- producing unit.

Interconnection - The connection needed to the local utility's system by customers producing some of their own electricity. An interconnection is needed to supplement the electricity produced by customers and to participate in net metering.

Net metering - Customers generating their own electricity receive credits to their monthly bill for energy they sell back to the utility. The "net" result of how much energy is provided to or used from the utility is applied to a customer's bill.

Real-time pricing - A rate that reflects the actual price of electricity throughout the day. With a real- time rate option, customers would pay more for power during times of peak demand, but a lower price in times of less demand. This pricing would encourage customers to help the reliability of the electric system.

Smart meter - Technology that indicates to customers the real-time price of electricity. This information may be used by a customer to use less electricity during times when the power is very expensive.

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Renewable energy resources lesson #1 - wind power

Over the last year, wind power in Ohio has attracted much attention as an emerging source of power. Electricity from wind is generated by turning two or three propeller-like blades around a rotor that is connected to a tower and spins a generator. This unit is called a turbine. Wind turbines are usually mounted on a tower at 100 feet or more above ground so they can take advantage of faster and less turbulent wind.

The most economical use of wind turbines is when they are situated in groups called "wind power plants" or "wind farms." Many wind farms are constructed on or near land typically used for agriculture, allowing the turbines to generate electricity while agricultural use continues undisturbed. Wind plants can range in size from a few megawatts to hundreds of megawatts in capacity depending on whether they are producing electricity for a single home, a number of buildings or sending electricity to a grid for widespread distribution. Annually, between 2.4 million and 3 million kilowatt-hours are generated for every megawatt of wind energy. Therefore, a megawatt of wind generates about as much electricity as 240 to 300 households use on average.

Ohio's current and future outlook

Currently, Ohio has several wind turbines in place, but the only wind farm is in Bowling Green. In central Ohio, a wind turbine was built at Glacier Ridge Metro Park to help educate Ohioans on the benefits of wind power. The Ohio Department of Development has funded the development of an interactive Ohio wind map to assist potential developers in selecting sites with adequate wind levels. Green Energy Ohio has implemented a tall towers project, where wind measuring devices are being placed on tall towers around the state to monitor wind activity.

National outlook

In the United States wind power efforts continue to grow. Most of the wind turbines in use today are on land. In October it was announced that a coastal wind farm was in the planning stages for Galveston, Texas. There is hope that wind will provide at least 6 percent of the nation's electricity by 2020.

To learn more about wind power, contact the OCC toll free at 1-877- PICKOCC (1-877-742-5622) or visit "Smart Energy" at www.pickocc.org.

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Consumers' voices were heard in telephone rules case

New telephone rules adopted by state regulators in March proved that consumers can make a difference and produce change. As a result of residential consumer input as well as recommendations from the Office of the Ohio Consumers' Counsel's (OCC) and 14 organizations, the Public Utilities Commission of Ohio (PUCO) scaled back a proposal that potentially could have resulted in a 20 percent rate increase per year for basic local telephone service and basic Caller ID.

Based on the final rules, most of Ohio's large local telephone companies could apply annually for the ability to increase the monthly price of basic local service by a maximum of $1.25. For most customers, this maximum would be less than half of what was proposed by the PUCO staff in November 2005. In addition, the monthly price of basic Caller ID could increase up to 50 cents per year.

As part of the PUCO's evaluation of the applications, the companies would need to meet one of several tests designed to show there are competitive telephone choices in each of their service areas. However, not all of the tests require that competitive options exist for customers who only want to purchase basic local service, without features like Call Waiting.

As the residential utility consumer advocate, the OCC along with other groups sought local public hearings to give consumers a chance to voice their opinions. In response, the PUCO held public hearings in seven cities and listened to testimony from residents. The OCC attended each hearing, educated consumers about the rules and encouraged the public to participate through testimony or by submitting letters to the PUCO.

The OCC and other groups in the case advocated at the PUCO for changes to the rules, including a phase-in of any rate increases and a requirement that comparable alternatives to basic local service exist before a telephone company could be eligible to raise its basic rates. The OCC supported one key part of the proposed rules - a provision that protected low-income customers enrolled in the Lifeline assistance program from the potential rate increases. The PUCO maintained the Lifeline protections, keeping basic services affordable for many of those customers least able to afford higher bills.

The rules relate to a law passed in 2005 that set out general principles regarding fewer regulations over basic services for telephone companies that can prove that there are no barriers preventing competitors from offering service. The OCC will continue to advocate that customers with only basic service deserve a choice of local telephone providers.

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