Legislation

05/08

Ohio Energy Law, Senate Bill 221, efective July 31, 2008. Revises the regulatory structure for electric public utility companies and establishes new policies for the development of advanced and renewable energy. The law mandates that by 2025, at least 25 percent of all electricity sold in the State come from alternative energy resources. Additionally, electric utilities will be required to achieve energy savings of 22.5 percent by the end of 2025 through energy efficiency programs. The law authorizes the Ohio PUC to develop rules for decoupling and requires the PUC to adopt rules establishing greenhouse-gas reporting requirements.

06/05

House Bill 66. Governor signed biennial budget for fiscal year 2006-2007, which consolidated the call centers operated by the Ohio Consumers' Counsel (OCC) and the Ohio Public Utilities Commission (PUC) into one center at the PUC. The PUC must keep the OCC informed of all calls.

03/01

House Bill 9. Governor signed amended substituted HB 9, which requires retail gas suppliers to be certified by PUC; authorizes governmental aggregation for competitive retail gas service; authorizes PUC to order open access for large LDCs; and consolidates consumer protection authority over certain retail natural gas transactions.

06/96

The Natural Gas Alternative Regulation Law, House Bill 476. Establishes customer choice as a State policy goal.

Citizen Action

Voters Approve Aggregation Program. Voters in the Village of Albany (Athens County); Pickerington City (Fairfield County); Indian Hill City, Lockland Village, Norwood City, Reading City, Sycamore Township, and Wyoming City (Hamilton County); Fredericktown Village and Mount Vernon City (Knox County); Bazetta, Bloomfield, Braceville, Bristol, Brookfield, Champion, Farmington, Fowler, Greene, Gustavus, Hartford, Howland, Hubbard, Johnston, Kinsman, Liberty, Lordstown, Mecca, Mesopotamia, Newton, Southington, Vernon, Vienna, Warren, and Weathersfield Townships (Trumbull County); and Marshallville Village (Wayne County) voted to give local officials the authority to purchase natural gas on behalf of residents, except where any person elects to opt out.

Voters Approve Aggregation Program. Voters in Woodmere Village (Cuyahoga County), Gallipolis City (Gallia County), Middlefield Township (Geauga County), Cheviot City and Green Township (Hamilton County), North Perry Village (Lake County), Austintown Township (Mahoning County), Champion Township (Trumbull County), and Perrysburg Township (Wood County) voted to give local officials the authority to purchase natural gas on behalf of residents, except where any person elects to opt out.

Voters Approve Aggregation Program. Voters in Salem City (Columbiana County), Fostoria City (Seneca County) and Marietta City (Washington County) voted to give local officials the authority to purchase natural gas on behalf of residents.

Voters Approve Aggregation Program. Voters in West Chester Township (Butler County), Grandview Heights City and Hilliard City (Franklin County), Xenia City (Greene County), Colerain and Springfield townships (Hamilton County), and Liberty Township and Newton Falls City (Trumbull County) voted to give local officials the authority to purchase natural gas on behalf of residents.

Voters Approve Aggregation Program. Voters in the Summit County communities of Barberton and Bath Township and the Stark County communities of Alliance, North Canton, Canal Fulton and the county's 17 townships voted to give local officials the authority to purchase natural gas on behalf of residents. Stark County has an estimated 65,000 residential and 2,500 small business gas customers.

Voters Approve Aggregation Program. Voters in Wapakoneta (Auglaize County), Tallmage (Summit County), Chardon Township (Geauga County), Amherst Township (Lorain County), and Navarre Village (Stark County) approved proposed opt-out gas aggregation programs.

Regulatory Action

On Rehearing, the PUC Increased Dominion East's Distribution Rate of Return. The PUC agreed to re-establish the company's rate of return at 8.49 percent. In its October 2008 order, the PUC had lowered the rate to 8.29 percent on the basis that the company's risk would be reduced by the approved levelized rate design. However, on rehearing, PUC found that a lower rate of return had already been incorporated in the new rate structure agreement. The new rate will result in a revenue increase of $40.5 million rather than the $37.5 million increase at the lower rate.

PUC Revises the Percentage of Income Payment Plan (PIPP) Program, which is an energy assistance plan for low-income natural gas consumers. The new plan reduces the required gas payments for program-eligible customers from 10 percent to 6 percent of their income. All PIPP-eligible customers must pay either 6 percent of their income each month or $10, whichever is greater. The PUC also set new credit rules and procedures for disconnection of residential utility services. The program will be reevaluated within 2 years.

PUC Approves New "Levelized" Rate Structure and Rate Increase for Columbia Gas of Ohio. Customers will pay a flat monthly charge to cover their share of Columbis's fixed distribution costs that do not change with gas usage. Previously some delivery costs were based upon gas usage, which increased costs during the winter when bills are high. The consumer advocate opposed the change, stating that it would hurt customers who try to conserve energy and result in low-use, low-income customers subsidizing high-use, high-income ones. The PUC also approved a $47.1 million rate increase, compared with the company's initial request for $87.8 million.

PUC Approves Levelized Rate Structure and Rate Increase for Dominion East's Distribution Service. Customers will pay a flat monthly charge to cover their share of Dominion's fixed distribution costs that do not change with gas usage. Previously some delivery costs were based upon gas usage, which increased costs during the winter when bills are high. The consumer advocate opposed the change, stating that it would hurt customers who try to conserve energy and result in low-use, low-income customers subsidizing high-use, high-income ones. The PUC also approved a $37.5 million rate increase, compared with Dominion's initial request for $75 million.

PUC Approves the Results of Vectren Energy's Auction. The auction resulted in a retail price adjustment of $2.35 per Mcf that will be in place from October 1, 2008, through March 31, 2010. This amount will be added to the NYMEX monthly settlement price to set the standard service offer (SSO) rate each month. Bids were received from six wholesale suppliers.

PUC Approves Results of Dominion East Ohio's Auction. The auction resulted in a new retail price adjustment of $2.33 per Mcf that will be in place from September 1, 2008, through March 31, 2009. This amount will be added to the NYMEX monthly settlement price to set the SSO rate each month.

PUC Approves Phase 2 of Dominion East's Plan to Exit the Retail Market But Extends Phase 1 Through March 31, 2009. The company replaced its gas cost recovery rate with a standard service offer rate in October 2006, based on a wholesale auction. Dominion will hold a new auction in the summer to set a new SSO rate for September 2008 through March 2009. Phase 2 of Dominion's plan will begin on April 1, 2009. Two more auctions will be held by February 2009 to puchase supplies for April 2009 through March 2010. One auction will set a standard choice offer (SCO) rate for choice-eligible customers and the other a new SSO for low-income or choice-ineligible customers. Another round of auctions will be held in February 2010 for the period April 2010 through March 2011. The PUC must approve all auction results.

PUC Approves Levelized Rate Structure and Rate Increase for Duke Energy of Ohio. Customers will pay a flat monthly charge to cover their share of fixed distribution costs that do not change with gas usage. The PUC also approved a $18.2 million, or 3 percent, rate increase, compared with the company's initial request for a $34.1 million, or 5.8 percent, increase. The new rates will be phased in over 2 years. Low-income customers not enrolled in PIPP will be eligible for a pilot program to reduce their flat rate charge. The fixed charges under the pilot program would be $4 less than those for the average residential customer.

PUC Approves Wholesale Auction Process for Vectren Energy Delivery of Ohio. Vectren received permission to eliminate its gas cost recovery rate and replace it with a more market-based rate, called a standard service offer (SSO). The SSO rate will be set through an auction scheduled for summer 2008 in which suppliers can compete for the ability to provide gas to Vectren. Customers can choose the SSO service or Vectren's choice program. Another auction will be held in 2009 to establish a standard choice offer (SCO) rate in which a customer's bill will identify the supplier. The program will be evaluated in March 2010.

PUC Approves Wholesale Auction Process and Demand-Side Management Program for Columbia Gas of Ohio. The wholesale auction, proposed to begin by April 1, 2010, would replace the current process for purchasing gas to supply customers not enrolled in Columbia’s Customer Choice program. The company expects to submit its auction application by February 2009. The PUC also approved the company's energy efficiency program, which will be in effect from 2009 - 2011, and a $36.5 million credit to customers for anticipated revenues generated through nontraditional sales of gas and pipeline capacity.

Wholesale Auction Process Proposed for Columbia Gas of Ohio. Columbia Gas of Ohio, the OCC, and the PUC staff asked the PUC to approve an agreement to develop a wholesale auction process for natural gas service and a comprehensive energy efficiency program. In addition, Columbia would share with customers $35 million generated through nontraditional sales of gas and pipeline capacity. The wholesale auction, proposed to begin by April 1, 2010, would replace the current process for purchasing gas to supply customers not enrolled in Columbia’s Customer Choice program.

Standard Service Offer Rate Replaces Gas Cost Recovery Rate on Dominion East Ohio's Bills, beginning October 2007. All customers will pay the same transportation rate for natural gas delivery, regardless of supplier. Dominion will continue to distribute natural gas and provide meter reading and billing services.

PUC Approves Results of Dominion East Ohio's Auction. The result of the auction was a Retail Price Adjustment of $1.44 per thousand cubic feet (Mcf), which will be added to the monthly NYMEX settlement price to determine the monthly standard service offer price. Bids were received from 12 wholesale suppliers. The PUC staff concluded that $2.196 to $2.504 per Mcf above the NYMEX monthly price was a reasonable benchmark to evaluate auction results.

Shell Energy Announces Transfer of Choice Customers to MXEnergy. Beginning August 1, Shell Energy Services Company will transfer all its Ohio choice accounts to MXEnergy, Inc. MXEnergy will honor any price plans and terms and conditions signed with Shell Energy for the full term of the customer's agreement.

PUC Selects Consultant to Oversee Dominion East Ohio's Supply Auction. CRA International was selected from 11 applications to assist the PUC in overseeing the auction and evaluating the results. The consultant costs will be paid by Dominion. The auction will be jointly monitored by Dominion, the PUC staff, the Office of the Ohio Consumers' Counsel, and CRA International.

PUC Conditionally Allows Columbia Gas Choice Suppliers Access to Capacity at Maumee Gate. Columbia Gas of Ohio must absorb any cost increases that would be passed on to sales customers as a result of the capacity allocation.

PUC Approves Phase 1 of Dominion East Ohio Pilot. As a first step in its 2-phase restructuring plan, the company received permission to eliminate its gas cost recovery rate and replace it with a more market-based rate, called a standard service offer, on a trial basis that will cover two heating seasons. Instead of purchasing gas through individual contracts, the company will conduct an auction in which suppliers can compete for the ability to provide gas to Dominion. According to the PUC, the plan will test the ability of market-based rates to expand competition among suppliers and reduce natural gas rates in the long term.

PUC Approves Minimum Service Standards for Utilities. The rules address installation, metering, billing, and customer service. Gas meters must be read at least once every 12 months, and utility customers must be given written notice of complaint procedures, customer rights and responsibilities, and information about gas choice programs.

PUC Approves Cinergy-Duke Energy Merger. Three States have approved the merger, with two more States pending. With the merger, Duke Energy will acquire Cinergy's Ohio subsidiary, Cincinnati Gas & Electric (CC&E). Within 3 months of the merger, CC&E must hold a workshop to discuss natural gas choice issues.

Dominion East Ohio Submits Plan to Restructure Its Commodity Sales Function. Company proposes a two-phase pilot program as part of its plan to exit the merchant function. In phase one, the gas cost recovery mechanism would be eliminated for its non-choice (sales) customers and replaced by a monthly market price determined through a bidding process. The winning bidders would become wholesale suppliers to Dominion for firm service re-delivery to the end-use customers. Under phase two, remaining sales customers would be assigned to participating marketers on a pro rata basis. At that point Dominion would become a distribution-only company but continue its role as the provider of last resort.

PUC Allows Monthly Rate Adjustments for Dominion East and Columbia. PUC approved Dominion East's application to make monthly changes to its regulated gas rate for the period February 4, 2005, through May 4, 2005, and Columbia's application to change to monthly adjustments beginning January 31, 2005. Columbia had proposed to return to quarterly filings duing the nonheating season (May-October), but the PUC ruled that would require a separate application.

PUC Approves Columbia Gas/Marketer Settlement. Settlement agreement freezes base rates and requires company to continue gas choice program through 2010. Allows company to contract for firm capacity to meet 100% of standby sales and core market requirements through October 2005. From November 2005 to October 2010, Columbia must meet 95% of standby sales and core market requirements.

PUC Modifies Columbia Gas/Marketer Settlement. Declined to pre-approve Columbia's plan to lock in interstate capacity through 2010 and to require marketers to buy 75% of that capacity from the utility. Instead, PUC will review capacity decisions in biennial audits and require individually negotiated agreements between Columbia Gas and its marketers. Also modified provisions for a base rate freeze and deferral authority for future recovery of infrastructure investment by shortening the time period from October 2010 to December 31, 2007.