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Embarq granted basic local service pricing freedom for 25 exchanges, denied for 19 exchanges

COLUMBUS, Ohio — December 17, 2008 — corrected version — Basic local service rates could increase for Embarq customers in 25 exchanges, however 19 communities were spared due to a decision released today by state regulators, according to the Office of the Ohio Consumers’ Counsel (OCC).

The Public Utilities Commission of Ohio (PUCO) granted Embarq’s request to be able to annually raise basic rates through “alternative regulation” in 25 exchanges. The OCC opposed alternative regulation in 29 of 44 exchanges.

“We are pleased that Embarq was denied the authority to impose annual rate increases for basic telephone services in 19 exchanges,” said Janine Migden-Ostrander, Consumers’ Counsel. “However, if Embarq uses its authority to raise prices for essential telephone services in the other 25 exchanges, it will create an additional burden on some customers’ already strapped household budgets.”

“Customers who want or need basic local service should be able to purchase it at a reasonable price. The fact is that choices are not available to those who want dial tone service without any bells and whistles,” Migden-Ostrander said.

The OCC asserted that Embarq did not demonstrate that residents in 29 of these exchanges have competitive choices for basic local telephone services. Alternative regulation allows telephone companies the ability to raise rates if the PUCO decides a competitive test is met demonstrating that an exchange is open to competition and residential customers have reasonably available alternatives.

Under alternative regulation, a telephone company can increase its monthly basic local rate by $1.25 each year, and the monthly price of basic Caller ID by 50 cents each year. Lifeline customers are exempt from these increases.

Editor’s note:

Below are listings of the individual exchanges for which Embarq was granted alternative regulation today: Anna, Archbold, Botkins, Defiance, DeGraff, Delphos, Johnstown, Lexington, Lima, Mansfield, Marysville, Morrow, Mount Vernon, Napoleon, Orrville, Pataskala, Russells Point, Shelby, Sidney, Smithville, Utica, Van Wert, Warren, Waterville and Wooster.

Below are listings of the individual exchanges for which Embarq was denied alternative regulation today: Bellefontaine, Bucyrus, Cardington, Centerburg, Chesterville, Cortland, Johnsville, Lafayette, Lucas, Marengo, Marshallville, Mt. Gilead, Mt. Sterling, Ottawa, Rittman, Sunbury, Wauseon, West Mansfield and Westminster.

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 Web site at www.pickocc.org.