Office of the Ohio Consumers' Counsel

Consumers' Corner

March / April 2011

In This Issue:

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The OCC: Celebrating 35 years of advocacy:
Saving Ohio's utility customers $10 billion

The Ohio General Assembly created the Office of the Ohio Consumers' Counsel (OCC) in 1976. The independent state agency was established to represent the interests of Ohio's 4.5 million residential households that purchase electric, natural gas, water and telephone services from Ohio's investor-owned utility companies.

This year, the OCC marks its 35th year of advocacy on behalf of residential utility customers. During that time, the OCC has played a substantive role in providing benefits for residential and non-residential customers that total more than $10 billion. Since 2004, the OCC has directly saved utility customers more than $171 million and an additional $6.4 billion in shared savings with other parties, where the OCC played a major role and, in many cases, led a coalition of advocates. In recent years, the amount of utility filings for rate increases has grown dramatically and, therefore, savings the OCC has been able to achieve in its challenges have been substantial.

The OCC, led by Consumers' Counsel Janine L. Migden-Ostrander, advocates for residential utility customers in state and federal courts as well as administrative proceedings before the Public Utilities Commission of Ohio (PUCO) and federal regulatory agencies. The state agency also monitors utility companies' compliance with legislative and regulatory standards and orders. The OCC's role is unique. It is the only representative for all of Ohio's residential customers to advocate before the PUCO, which renders decisions in utility cases.

["Among the list of Ohioans' top household expenses are utility payments. Electricity, natural gas, water and telephone services are included among the critical costs of living requirements." Janine L. Migden-Ostrander Consumers' Counsel ]

The OCC also educates residential customers about utility issues and services provided by their investor-owned electric, natural gas, telephone and water companies. The agency participates in state and national legislative forums to maintain customer protections and promote least cost planning as a primary means to keep utility prices affordable. The OCC has an outreach and education unit that goes into communities to provide customers, government officials and community groups with information about a wide host of critical utility issues.

[In SFY 2010-11, the OCC saved utility customers $54.8 million directly through its advocacy and an additional $1.9 billion in shared savings with other partners.]

Funding and Budget

The legislature, in establishing the OCC, decided that funding for the agency would not come from Ohio's General Revenue Fund. Instead, the OCC's budget is underwritten by assessing a fee on the intrastate gross earnings or receipts of Ohio's investor-owned public utility companies at an average cost of approximately $1 per year per household. Specifically, in SFY 2010-11, the OCC saved Ohio's residential utility customers more than $54.8 million directly on its own and $1.9 billion in collaboration with other parties with the OCC in a lead role.

Governing Board

By statute, the Ohio Attorney General appoints the OCC's bi-partisan nine-member Governing Board. The Board consists of three members representing organized labor, residential customers and family farmers, respectively. No more than five members of the board may be from the same political party. Board members are confirmed by the Ohio Senate and serve three-year terms. The OCC Board is responsible for appointing the consumers' counsel and deputy consumers' counsel. The OCC governing board conducts regular public meetings every other month in Columbus.

About the Office

The OCC staff, which includes attorneys, economists, engineers, investigators and other highly skilled professionals, advocates diligently on behalf of Ohio's residential utility households about natural gas, electric, water and telephone utility issues.

The OCC's staff is organized into various departments working together to achieve its mission and vision. They include:

  1. Legal: Providing legal representation regarding hundreds of utility filings at the PUCO, Federal Energy Regulatory Commission and the Federal Communications Commission that would affect residential utility customers in Ohio;

  2. Analytical: Providing technical and policy analysis in utility filings. It assures just and reasonable rates for residential utility customers and participates in proceedings, workshops and other forums where cutting-edge energy, water and telecommunications policies are debated;

  3. Operations and Consumer Services: Encompassing the administration and customer services divisions of the OCC is the operations department. The Customer Services Division assists individual customers through a toll-free hotline addressing complaints, questions and concerns regarding their utility services and negotiation of payment plans to avoid disconnection, among other services;

  4. Communications: Providing education and resources to the public and the media that meet customers' needs and concerns relating to their utility services; and

  5. Administration: Overseeing the management of the OCC and advocating through its government affairs section for the interests of residential customers regarding their utility costs and service quality in the state legislature and in Congress.

By Beth Gianforcaro

About the OCC

  • Created by the Ohio General Assembly to represent the 4.5 million residential households.

  • Not funded by Ohio's General Revenue Fund.

  • With an operating budget of approximately $8.5 million per year, the OCC costs Ohio households approximately $1 per year and has saved residential customers $2.70 annually, netting them $1.70 in savings.

  • In SFY 2010-11, the OCC saved utility customers $54.8 million directly through its advocacy and an additional $1.9 billion in shared savings with other partners.

  • During the past 35 years, the OCC has saved utility customers $10 billion in avoided utility costs.

  • The OCC offers unique utility consumer education to Ohioans.

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OCC advocacy leads to $92 million in residential customer savings

As a result of advocacy by the Office of the Ohio Consumers' Counsel (OCC), the Public Utilities Commission of Ohio (PUCO) issued rulings saving customers more than $92.4 million.

American Electric Power excess earnings

A credit of $43 million is being sent to customers of American Electric Power's Columbus Southern Power utility. The OCC recommended a $156 million refund as it was clear customers overpaid the utility in 2009. Ohio law protects customers from paying excessive rates. The refund was first applied to pay off certain costs deferred for future collection. The remaining money is being returned to customers in the form of monthly bill credits from February to December. The average Columbus Southern Power customer who uses 1,000 kilowatt-hours of electricity per month is receiving a total credit of $14.76.

Duke Energy Ohio storm costs

The PUCO cited several recommendations from the OCC in its decision to disallow Duke Energy Ohio from collecting $14.4 million from residential customers in costs related to the 2008 Hurricane Ike-related windstorm. The decision removed more than half of Duke's original $28.5 million request. Residential customers will pay 35 cents per month for the costs approved by the PUCO.

[Assistant Consumers’ Counsel Maureen Grady presents oral arguments to the Supreme Court]

Duke Energy Ohio energy efficiency programs

Duke Energy Ohio was required to credit $35 million to customers after it improperly charged customers for its energy efficiency programs. The OCC argued for the refund, and the PUCO agreed, because Ohio law only allows utilities to recover its fixed costs for distributing electricity it loses as a result of energy efficiency programs the utility implements. Duke was recovering revenues for distributing and generating electricity.

In another action, the OCC continues to seek additional savings for AEP residential utility customers:

American Electric Power retroactive rates

In February, the OCC argued before the Supreme Court of Ohio for refunds totaling $63 million for American Electric Power customers. The PUCO, in 2009, allowed AEP to collect 12 months of rates from customers in nine months. This retroactive ratemaking is against the law and goes against previous legal decisions. Other PUCO errors the OCC appealed also could result in the return of more than $560 million.

By Anthony Rodriguez

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AEP offers home energy audits to customers

[photo by Bill Ferriot]The latest additions to help American Electric Power (AEP) customers become more energy efficient are the utility's home energy audit programs. With the help of the Office of the Ohio Consumers' Counsel (OCC), AEP developed the programs to provide the audits to customers at discounted prices.

Two different types of audits are available – an energy assessment and a comprehensive home energy audit. During the hour-long assessment, a certified auditor performs a visual inspection of the home to identify areas that could benefit from energy efficiency improvements. The audit is an in-depth analysis that includes several home efficiency tests such as efficiency reports of all major energy users, a blower door test and evaluation of appliances, lights, and electric heating and air conditioning systems.

The assessment and audit both provide installation of a variety of energy saving measures. These include compact fluorescent light bulbs, a low-flow showerhead, programmable thermostat, faucet aerators and pipe insulation. A thermostat will not be installed if the home has a heat pump. The measures only will be installed with the customer's permission.

The assessment costs $25 and the audit price is set by qualified auditor; customers should remember to shop around for the best price.

AEP will rebate $100 of the audit's costs to homeowners who heat with electricity and $75 for all others.

Energy efficiency measures installed as a result of either the assessment or audit qualify for rebates. A list of rebates is available from AEP. Additional rebates are available if $1,000 or more of improvements are installed.

More information about the audits and a list of certified auditors and contractors is available online at www.gridsmartohio.com. Customers may call 1-877-856-2454 for more information or to set up an audit.

Columbia Gas of Ohio and Dominion East Ohio have similar home energy audit programs. Low-income customers also can take advantage of an energy audit through the state's Home Weatherization Assistance Program. Customers may call the OCC toll free at 1-877-742-5622 for more information about these programs.

By Anthony Rodriguez

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Efficiency programs put cheaper energy at customers' fingertips

Customers looking to stay warm during the winter and cool during the summer may want to consider a variety of programs offered by Ohio's investor-owned utilities to help improve efficiency. Six electric and natural gas utilities have developed programs that, if utilized, can help reduce energy bills without reducing home comfort levels.

The programs range from comprehensive home energy audits to help pinpoint the best areas to improve to simple and easy lighting discounts for compact fluorescent light bulbs.

Energy efficiency continues to be the cheapest alternative to Ohio's growing energy needs. Current figures show energy efficiency is 89 percent cheaper than building a coal plant with carbon-capture technology.

American Electric Power, Columbia Gas of Ohio, Dayton Power and Light, Dominion East Ohio Gas, Duke Energy Ohio and Vectren Energy Delivery of Ohio each have energy efficiency programs for their customers.

For more information about the programs, customers can contact the Office of the Ohio Consumers' Counsel at 1-877-742-5622 or visit www.pickocc.org where up-to-date fact sheets are available to download.

By Anthony Rodriguez

 

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Proposed legislation will lead to rate increases for natural gas customers

The Ohio House of Representatives introduced legislation Feb. 10 that, if passed, would raise customer rates by allowing natural gas utilities to increase distribution rates without being subjected to a thorough public review by state regulators. House Bill 95, introduced by Rep. Peter Stautberg (R-Anderson Township), eliminates elements of existing law that require utilities to provide evidence their increase requests are fair and reasonable.

Distribution rates are separate from the actual cost of natural gas. They include the fixed charges customers pay as well as expenses utilities incur for pipeline maintenance and other operations costs. While customers have the ability to choose to pay the lowest rate they can find for their natural gas supply, they have no control over the distribution rates they pay their local natural gas utility. These are the costs that will increase dramatically if House Bill 95 is enacted into law.

Presently, when natural gas utilities seek distribution rate increases, it is necessary for them to submit their requests to the Public Utilities Commission of Ohio (PUCO). The law currently allows for a through review by the Office of the Ohio Consumers' Counsel (OCC), the PUCO Staff and other interested parties to determine if the utilities' requested rate increases are justified. House Bill 95, if passed, will result in distribution rates going up without this level of review.

How House Bill 95 will impact customers:

  • Customers may literally face billions of dollars in rate increases without the benefit of current customer protections;

  • Customers could be forced to pay for more than the utility's actual costs no matter how much or how little natural gas they use; and

  • Distribution rate increases could occur without public notice or hearings.

The OCC will continue working with legislators and natural gas industry representatives to produce a bill that is fair to residential customers.

By Marty Berkowitz

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Auction results in lower rates for Vectren natural gas customers

Beginning April 1, Vectren Energy Delivery of Ohio residential customers who purchase natural gas under the Standard Choice Offer (SCO) will see their rates decrease. Customers who choose to remain with Vectren rather than enter into a contract with an independent Choice marketer will pay about $18 less per year based on an average annual usage of 890 cubic feet (Ccf) of natural gas.

[photo by Bill Ferriot]Representatives from the Office of the Ohio Consumers' Counsel attended a retail auction in January that determined Vectren's new rate. The auction resulted in a new retail price adjustment to the wholesale price of natural gas calculated each month on the New York Mercantile Exchange (NYMEX). The lowest bid was $1.35 per thousand cubic feet (Mcf), 20 cents lower than the current retail price adjustment established at a similar auction last year. Vectren customers will see the retail price adjustment reflected on their monthly bills as 13.5 cents per Ccf.

The final bids at the auction were awarded to three retail suppliers who won the right to have their names listed on customers' natural gas bills. However, regardless of the supplier name listed on the customers' bill, the SCO rate is the same. For current SCO customers, the supplier's name may or may not be the same as the name they currently see on their bills.

Customers on the Percentage of Income Plan (PIPP Plus) will continue to see the direct sales service rate (DSS) rate. This rate includes the original excise tax rate rather than their county sales tax that is added to the SCO. The cost of natural gas will be the same as for SCO customers.

Vectren will continue to transport natural gas through its pipelines and remain responsible for pipeline repair, meter-reading, billing and other customer service functions.

By Marty Berkowitz

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Tell Us What You Think About Consumers' Corner!

For decades, the Office of the Ohio Consumers' Counsel has communicated with consumers through its bi-monthly newsletter, Consumers' Corner. This publication is available in both electronic and print versions. As a subscriber, we value your input.

You may have noticed that beginning in 2011, the newsletter is now printed in color. We are able to do so at the same cost as we were printing in black and white. Studies show that the addition of color makes publications easier to read and more interesting. We hope that is your experience with the Consumers' Corner newsletter, as well.

We are planning for the content and style of future publications and would appreciate your feedback in one of two ways:

1) Electronically – Visit www.pickocc.org, click on the Consumers' Corner newsletter survey link.

2) By phone – You can call the OCC toll-free at 1-877-742-5622 press option 4 to present your responses over the phone.

Responses to 10 brief questions are anonymous. Thank you for your input!

Please Note:

OCC has had to cancel many of its services, including its consumer call center, due to recent budget cuts. We realize you may continue to need assistance with your utility services. OCC's website provides free access to publications and resources.

You may seek assistance with utility complaints from the Public Utilities Commission of Ohio:
800-686-7826. For complaints about non-utility related services, you may call the Ohio Attorney General
at 800-282-0515.

Information believed accurate but not guaranteed.
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The Office of the Ohio Consumers' Counsel is an equal opportunity employer and provider of services.
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