Office of the Ohio Consumers' Counsel

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Consumers’ Counsel proposes energy bill amendments: Residential customer protections and safeguards recommended

COLUMBUS, Ohio – October 16, 2007 – Important amendments to a state energy bill are needed to protect Ohio’s 4.2 million residential electricity customers and have been proposed by the Office of the Ohio Consumers’ Counsel (OCC). As the residential utility consumer advocate, the OCC has prepared amendments for consideration by the Senate Energy and Public Utilities Committee.

“The OCC’s proposed amendments are designed to ensure that customers obtain the lowest cost option for providing electric service through a fair and open process,” said Janine Migden- Ostrander, Consumers’ Counsel. “Over the next several years, utilities likely will seek to charge customers for billion of dollars in costs. Those increases would put a strain on many household budgets, so it is important that the legislation do everything possible to minimize the impacts.”

Key residential consumer principles addressed in the OCC’s amendments include:

Protecting customers’ rates by providing the lowest-cost electricity option. The OCC proposes that a side-by-side review and comparison of the governor’s proposed Electricity Security Plan and the market price of providing electricity be required. The comparison should be performed in each utility’s service territory since these rates can vary significantly. This will ensure that the path providing the lowest rates is implemented in each part of the state.
Fairly calculating the value of existing power plants to ensure that consumers will not overpay. The OCC believes that any payment by customers to support existing power plants should be based on objective criteria for determining rates. The amount billed to customers should be based on the cost to provide service and result in reasonable profitability for the utilities, and no more.
Enhancing the use of energy efficiency and renewable energy in Ohio. Technology exists to help lower customers’ demand for power through energy efficiency. Energy efficiency is a far less costly option than any supply-based option and represents Ohio’s best opportunity to manage and deflect rising costs to keep service affordable for customers. The OCC’s proposed amendments would commit more efforts toward energy efficiency measures to reduce usage and customers’ bills.

Likewise, the state has tremendous potential to diversify the resources used to produce electricity, including the need for utilities to use wind and solar. Because these resources do not pollute and have no fuel costs associated with them, the OCC recommends that Ohio obtain a minimum of 20 percent of its energy from renewable resources by 2025. A 12.5 percent advanced energy standard (including nonrenewable resources such as clean coal and nuclear) in the pending legislation would be preserved, but be in addition to the 20 percent renewable energy standard proposed by the OCC.

Last week, Migden-Ostrander testified before the Senate Energy and Public Utilities Committee. In her testimony she encouraged Ohio lawmakers to consider the impact of the energy plan on residents’ budgets. Praising Governor Strickland for presenting a framework for an energy policy, she noted that much work remains.

“We need clarity, transparency, consumer protection, energy planning that includes maximizing energy efficiency and renewable energy and most importantly, assurances that least cost options will be available to all Ohioans,” Migden-Ostrander told the committee.

“What policymakers do today will have a profound impact on the millions of families across the state,” she said. “The final plan should provide for the implementation of least-cost and least-risk options over the short- and long-run, and should open the door for nontraditional advanced technologies to emerge such as energy efficiency and renewable energy.”

About the Office of the Ohio Consumers' Counsel

The Office of the Ohio Consumers' Counsel (OCC), the residential utility consumer advocate, represents the interests of 4.5 million households in proceedings before state and federal regulators and in the courts. The state agency also educates consumers about electric, natural gas, telephone and water issues and resolves complaints from individuals. To receive utility information, brochures, schedule a presentation or file a utility complaint, residential consumers may call 1-877-PICKOCC (1-877-742-5622) toll free in Ohio or visit the OCC website at www.pickocc.org.