Office of the Ohio Consumers' Counsel

Media Center

Contact: Marty Berkowitz
(614) 387-2962

OCC urges Columbia customers to participate in hearings on utility’s proposal to change how it acquires natural gas

COLUMBUS, Ohio – May 12, 2009 – The Office of the Ohio Consumers’ Counsel (OCC) encourages Columbia Gas customers to participate in local hearings about the utility’s proposal to change its method of purchasing natural gas.

Currently, Columbia uses a monthly gas cost recovery system to calculate the price it charges its customers for natural gas. If its proposal is approved by the PUCO, a wholesale auction will be held to determine a retail price adjustment to the monthly natural gas price listed on the New York Mercantile Exchange (NYMEX).

The PUCO scheduled four public hearings for consumers to express their opinions:

Columbus, Tuesday, June 9, at 6 p.m., Wolfe Park Shelter House, 105 Park Drive.
Parma, Thursday, June 11, at 6 p.m., Parma City Hall, Council Chambers, 6611 Ridge Road.
Toledo, Tuesday, June 23, at 6 p.m., Michael V. Disalle Government Center, One Government Center, Commissioners Hearing Room, 1st Floor, 640 Jackson St.
Athens, Thursday, June 25, at 6 p.m., Athens Community Center, 701 East State St., Suite 201

The wholesale auction would allow bidders to compete for portions of Columbia’s natural gas supply. The lowest bid received would be added to the NYMEX price to determine the utility’s Standard Service Offer. Similar auctions lowered the cost for customers of Dominion East Ohio and Vectren Energy Delivery Ohio.

The most recent public auctions, held in February in the Dominion service area, added $1.40 to the wholesale price of gas, which resulted in savings to customers not participating in a Gas Choice program.

If the PUCO approves the request, Columbia would continue to be responsible for the distribution of natural gas as well as billing, reading meters and maintaining pipelines.

The residential utility consumer advocate has supported use of the wholesale auction approach as a way to offer lower rates to ratepayers; however, the agency does not support a full exit of the merchant function by Columbia Gas.

“We support the concept of the wholesale auction as a means for customers to save money on their natural gas bills,” said Consumers’ Counsel Janine L. Migden-Ostrander. “We have been pleased with the results for Dominion and Vectren customers, who have seen their rates lowered because of this approach.

“However, we believe that any future attempt by Columbia, or the natural gas marketers, to hasten a move to a retail auction or complete exit of the merchant function must receive more thorough PUCO scrutiny as the benefits to consumers of such a move have not yet been demonstrated,” the Consumers’ Counsel added.

At the public hearings, consumers can give sworn testimony, which will become part of the official record and be considered as PUCO commissioners make a decision. The OCC staff will attend representing residential customers of Columbia and be available to the news media for interviews.

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.