Consumers' Corner

May / June 2008

In this issue...

 

Consumers speak out against higher FirstEnergy rates

Consumers who already have some of the highest electric rates in Ohio showed up in droves at a dozen local public hearings held throughout FirstEnergy’s Cleveland Electric Illuminating, Ohio Edison and Toledo Edison service areas in March. The Office of the Ohio Consumers’ Counsel (OCC) encouraged residential consumers to voice their opinions to the Public Utilities Commission of Ohio (PUCO), which held the hearings as part of FirstEnergy’s proposed distribution rate increase.

FirstEnergy filed with the PUCO to collect $340 million more in annual revenue from all customers (residential, commercial and industrial), beginning in 2009. Distribution rates generally recover a utility’s costs for local facilities and equipment such as poles and wires.

The OCC believes that FirstEnergy’s proposed rates are unreasonable and should be modified by the PUCO. Based on the OCC’s experts, consumers should not have to pay for many of the multi-million dollars in costs the utility is seeking to recover. Residential utility consumers who pay FirstEnergy’s monthly electric bills agreed.

More than 600 consumers attended the 12 local public hearings held in Akron, Austintown, Barberton, Cleveland, Geneva, Mansfield, Maumee, Sandusky, Shaker Heights, Springfield, Toledo and Wauseon. Sworn testimony provided by consumers at each public hearing became part of the official case and is considered as the PUCO Commissioners make a decision.

OCC staff and attorneys attended each public hearing to answer questions and provide information to residential consumers.

“We consider consumers the experts on how a rate hike will affect their budgets and whether electric service quality is adequate,” said Janine Migden-Ostrander, Consumers’ Counsel. “The testimony we received showed budgets are already tight. We appreciate consumers’ participation in the rate case process and enduring difficult weather conditions to travel to hearings to make their voices heard.”

A decision on this case is anticipated in May.

For consumers who were unable to attend the local public hearings, they can send letters to the PUCO. All letters and envelopes should reference Case Number 07-551-EL-AIR and should be sent to the Public Utilities Commission of Ohio, Attn: Docketing Division, 180 E. Broad Street, Columbus, OH 43215.

Consumer Voices

Below are some excerpts from the testimony given at some of the FirstEnergy local public hearings:

“Seeking a rate increase to generate additional revenue for your company, I can understand that, but what about the poor and the middle class that is between a rock and a hard place?” – Effie from Akron

“Plain and simple, this rate increase should not be approved due to the present economic situations in Ohio, such as job losses, home foreclosures and unemployment numbers.” – John from Youngstown

“I’ve been (working at the partnership) for 31 years and I’ve seen families make tough decisions whether they can eat or whether they can pay their utility bills. The idea of paying anything more … just does not sit well with those families.” – Vesna from the Mahoning Youngstown Community Action Partnership

“. . . at a time when Ohio Edison and FirstEnergy is coming to us for a rate increase, they have record profits of $1.3 billion … Top corporate officials called 2007 a solid year and predicted even better results this year. So not only did they have a record profit, their own testimony is they’re predicting a better year next year.” – Ron from Austintown

“We’re not complaining, but just letting you know that both individual households and charitable organizations are stretching every penny to make it possible for people to keep their utilities connected. We would all like more income, more profit, more financial security in our lives, but in these hard times many of us are learning to live within the most restrictive budgets we’ve ever experienced, and we believe FirstEnergy should learn to do the same.” – Cathleen from the Barberton Area Community Ministries

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OCC in your corner

OCC wins case on AEP’s proposed IGCC plant

In a victory for Ohio consumers, the Supreme Court of Ohio found that the Public Utilities Commission of Ohio (PUCO) must re-evaluate its decision that would allow American Electric Power (AEP) to collect costs before a proposed power plant is constructed.

The Court agreed with the Office of the Ohio Consumers’ Counsel (OCC) that AEP’s proposal for an Integrated Gasification Combined Cycle (IGCC) plant violated Ohio’s electric choice law regarding the pricing of electric generation service and found that the process to include any generation facility in rates must follow existing law, which had not occurred.

The Court did, however, give the PUCO the opportunity to supplement its original finding and justify why AEP should be allowed to recover revenue for its proposed IGCC plant. The PUCO also will have to address the standard which requires a power plant to be at least 75 percent complete before a company can recover costs.

Agreement would cut Duke increase in half

An agreement reached involving some of the major issues within Duke Energy’s natural gas rate case would benefit residential consumers by trimming the increase proposed by the utility. The OCC and all other parties involved in the case signed the agreement, which must receive PUCO approval before going into effect.

This agreement would cut Duke’s proposed base rate increase by $15.9 million per year. In addition, price caps and other changes to Duke’s Accelerated Main Replacement Program – which replaces steel pipes with plastic – would lift some of the burden on households. Duke reduced its projected investment and the agreement helps shift some of the costs away from residential consumers to larger energy users and spread out the costs over more time. The changes could save residential consumers more than $100 million over the 11 years of the plan.

An important issue not resolved through the agreement is how Duke would collect its additional revenue. As part of Duke’s rate increase application, its flat-rate customer charge would nearly triple from $6 to $15 per month. According to the OCC, this would disproportionately impact residential customers in smaller homes or who try to be energy efficient. The OCC is litigating this issue before the PUCO.

Verizon penalized for missing service benchmarks

Verizon was held accountable for missing service benchmarks with a $250,000 penalty. This followed a request by the OCC that the PUCO impose a penalty based on Verizon’s failure to meet its monthly obligation to restore customers’ service outages within 24 hours at least 85 percent of the time in each of its four Ohio districts.

The obligations and related penalty stem from an agreement between the PUCO and Verizon regarding service quality for Verizon’s traditional landline telephone business. The company’s wireless service was not at issue. The $250,000 must be used toward broadband initiatives in Ohio.

Consumers receive permanent status on “Do-Not-Call” registry

Based on a recent federal law, residential consumers’ Do-Not-Call registrations are permanent, eliminating the need for individuals to re-register.

The national registry went into effect in June 2003. Prior to the new law, consumers’ registrations on the national Do-Not-Call list expired after five years, which meant consumers would have needed to re-register for the list as soon as this summer. The OCC, as a member of the National Association of State Utility Consumer Advocates, called for the national Do-Not-Call registry to be a permanent list.

Consumers who would like to register for the list can do so by visiting www.donotcall.gov or calling toll free 1-888-382-1222 from the number they wish to register. Registration is free.

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Learn about the availability of enhanced 911

In an emergency situation, consumers often take 911 service for granted. But when consumers in trouble dial those three special digits, will their locations automatically be provided to the emergency operator? The answer lies in the availability of enhanced 911 (also known as E-911) -- the technology needed to determine the location of a call and send it to the right emergency operator.

Nearly all of Ohio’s 88 counties have enhanced 911 service when residents call from traditional home telephones – a map by the Public Utilities Commission of Ohio (PUCO) shows that Columbiana, Harrison, Monroe and Meigs counties still need to fully implement the location technology. But the fact is that, more than ever, consumers are using wireless services both at home and while traveling. Some Ohioans use wireless services exclusively. Nationwide, more than 70 million calls to 911 emergency operators each year are made from wireless handsets.

Enhanced 911 is not yet available to all wireless customers or in all Ohio counties. While consumers can still make 911 calls from their wireless handset, their location may not automatically be sent to the emergency operator. Location technology includes methods to find the cellular towers close to the caller as well as GPS (Global Positioning System) to more accurately pinpoint where the caller is located.

The challenge involves the fact that wireless handsets travel with consumers. While a home telephone is associated with a specific street address, a wireless handset could be across the country.

Two major factors affect the operation of wireless E-911: 1) the implementation of the technology in public safety access centers; and 2) the use of E-911-capable wireless telephones.

As of January 2008, 28 counties in Ohio have fully implemented wireless E-911, most of which took advantage of a 32-cent per line surcharge on wireless bills enacted by the Ohio General Assembly in 2005. Other counties are at different stages of implementing the technology, including 11 counties that have not yet received funding or begun the implementation processes: Crawford, Greene, Harrison, Highland, Meigs, Morgan, Noble, Perry, Seneca, Trumbull and Wyandot.

Even if all 88 counties in Ohio had E-911 technology implemented, some consumers do not have E-911-capable wireless telephones and would not receive the safety benefits. Federal Communications Commission (FCC) rules require wireless providers to ensure that 95 percent of their customers’ handsets are E-911 capable. The FCC, however, does not specify the method providers must use to comply (for example, discounts to customers for upgrading their handsets or a policy of refusing to reactivate older handsets).

Enhanced 911 for wireless telephones is a work in progress. Ohio consumers will be much more protected during an emergency once needed technology is installed statewide.

Consumer Tip

Some wireless telephones or their owner’s manuals may indicate if a location technology is embedded in the telephone. Consumers can call their service provider with any questions.

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Utility bills can be a valuable tool to reduce energy usage

Every month, utility bills come in the mail and consumers write checks to pay for the services they have received. But the next time you open an envelope with a utility bill enclosed, take a closer look. The information contained on the bill may be able to help you make decisions to become more energy efficient.

Utility bills are required to give information pertaining to how much natural gas or electricity has been used over a 12- or 13-month period. Some even relay weather data to show the role it may have played in monthly usage. With this information, an analysis of electric or natural gas usage patterns can be made and used to determine to what extent you may want to employ energy efficiency measures in your home.

Tactics to make your home more energy efficient include installing a high-efficiency furnace or boiler, setting back the thermostat, weather stripping, additional insulation and water heater blankets. There are several more ways to increase the efficiency of your home and the OCC has information available in the Smart Energy section of its Web Site, www.pickocc.org.

Optimum efficiency can be achieved through a home energy audit. After an analysis of your home, a certified contractor can give you the recommendations that will greatly improve the efficiency of your home. Customers of Duke Energy Ohio and FirstEnergy can also take advantage of programs that offer rebates for home energy audits or other programs to assist in energy reduction. Columbia Gas of Ohio customers should also have access to similar programs soon.

If consumers would like more information on tactics that could result in monthly savings on electric or natural gas bills or assistance in understanding the charges on their bill, they can contact the OCC toll free at 1-877-PICKOCC (1-877-742-5622).

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Need to Know: Remember to call first before you dig

Spring is the time of year when green thumbs begin sprouting up across the state. When taking up horticulture, there is important information that all consumers need to consider before planting gardens, trees or any other landscaping projects.

Homeowners should call the Ohio Utilities Protection Service (OUPS) as the first step when starting a project that requires digging. It is important for safety but it is also state law. The OUPS is a non-profit organization that links consumers with their utilities to identify the location of underground pipes and wires. Call the OUPS at 1-800-362-2764 at least 48 hours but no more than 10 days before starting a digging project. The OUPS is available to schedule 24 hours a day, excluding weekends and holidays.

Utility companies have 48 business hours to mark utility lines. Utilities only are required to mark lines they own and maintain. Customer service lines – often those that run from the curb to the home – are the responsibility of the homeowner to know where they are located.

Once the locations of vital utility lines are known, gardening, tree planting or landscaping can begin with ample clearance. According to the Ohio law, an 18-inch tolerance zone is needed on either side of the marked utility line. Gardeners also should consider the location of overhanging utility lines when planting trees as to avoid having trees reach a height that will interfere with the lines. Smaller trees located in the vicinity of power lines may be a wiser option.

If planting trees or cultivating the home landscape is part of your springtime plans, the location of these projects may also help improve the efficiency of your home. They can maximize shade and protect against the wind, which may reduce the need for heating or air conditioning. To find out what trees grow best in Ohio, visit the National Arbor Day Foundation at www.arborday.org/treeinfo/zonelookup.cfm.

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Program your way to savings

Do you leave your thermostat at one temperature throughout the spring and summer? Are you looking to save money on your energy bills? By raising the temperature of your thermostat five degrees for eight hours (for example, while you are at work), you can save 10 percent on your electric bills since the air conditioning system will not be working as hard.

With our busy schedules, we can easily forget to manually set back the thermostat before leaving for work. By installing a programmable thermostat, you can pre-set the desired time and temperature to your daily schedule. An ENERGY STAR programmable thermostat includes a minimum of four program settings a day.

ENERGY STAR qualifies three types of programmable thermostats. The 5+2 models allow you to set the same schedule Monday through Friday and another for the weekend. The 5+1+1 uses the same schedule every weekday and different settings on Saturday and Sunday. The 7-day models allow you to set different programs each day.

Many retailers, including major home improvement stores, sell programmable thermostats. Programmable thermostats range in price from $30 to $150 and can often be installed by a consumer.

If consumers do not feel comfortable installing the thermostat themselves, they can hire a home ventilation and air conditioning professional or an electrician to install a programmable thermostat for a fee.

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