How to go
Butler County customers can voice their concerns to PUCO at 6:30 p.m. Sept. 8 at the Middletown City Building in council chambers.
CINCINNATI — Opponents of Duke Energy’s nearly decade-long energy plan say it monopolizes the very industry that was deregulated in hopes of spurring customer choice.
In other words, it’s a step backward.
The proposal, if approved by the Public Utilities Commission of Ohio, may increase energy generation rates for years to come, too. The production of electricity and delivery into homes and businesses makes up a bulk of customer’s bill.
“This plan is for Duke’s electric generation rates, which are separate from distribution rates — those are the two parts of your (monthly) bill,” said Matt Butler, PUCO spokesman.
In Southwest Ohio, Duke is the company that delivers, maintains and collects energy bills. But in Hamilton, likely one of the few cities that provides its own energy to residents, the proposed plan will have no effect, said Tony Pochard, assistant director of electric.
About 15 to 20 percent of Hamilton’s energy is purchased on the market, rather generated, Porchard said.
But Duke Energy contends the plan is necessary to provide energy in the future as demand will likely increase.
“The rate for this current period was set three years ago, and that was before the crash of the economy,” Duke Energy spokeswoman Sally Thelen said. “That’s when you started seeing other companies and wholesalers come in and take some of the share of customers and offer a lower rate because of a low market rate.”
Duke filed its new energy security plan in June and, if approved, would set rates from January 2012 through May 31, 2021, according to the Public Utilities Commission of Ohio.
The new plan calls for electric retail generation rates to be determined through a competitive bid process conducted by an independent bid manager in hopes of providing long-term price stability. The plan also will share profits from energy sales from Duke Energy Ohio power plants would be shared between customers and the company — 80 percent and 20 percent, respectively, according to Duke Energy.
For 2012, Duke proposes rate increases of approximately 8 percent for both summer and winter months — additional increases are requested through May 2021, according to PUCO.
Thelen agreed with PUCO’s assessment of the rate increase and also expects residential customers who use about 1,000 kilowatts per month of energy to see a spike of about $10 per month.
Approximately 70 percent, or $7, of that cost is to generate energy, she said.
Thelen characterized the new plan as a “hybrid” approach, which included auctioning of electricity but also included a non-bypassable rate so that, “if any of our customers left, they would still be paying a non-bypassable rate to us,” she said.
“In other words, the customers ensure we remain an Ohio business for years to come and make sure jobs stay, too.”
It is “non-bypassable rider,” which shows up on a customer’s bill, that opponents say kill competition in Ohio’s energy industry.
A law enacted in 1999 restructured Ohio’s electric industry, a once heavily regulated industry, allowed for customers to shop for electricity.
“The non-bypassable rider is a fancy term for a surcharge,” said William Massey, a Washington-based lawyer for Compete. “This plan would move us back toward a monopoly-regulated system, where there is a single supplier of electricity and customers have no choice — Ohio is really at a crossroads.”
Compete is a group of national energy suppliers and large energy consumers such as Cincinnati-based Macy’s, City Gospel Mission in Cincinnati, and Wal-Mart Stores Inc.
The Alliance for Competitive Energy classifies the non-bypassable rider as an “inescapable new tax on electricity.”
Massey also doesn’t care much for the length of the proposal.
“This proposal is intended to be in effect for a whopping nine years and five months,” Massey said. “That is not in the public interest to keep a plan in place that long.”
During the first of four public hearings on Duke Energy’s energy plan on Tuesday, customers had their say at Cincinnati State.
“It’s a very confusing proposal, it seems like it’s everything and the kitchen sink,” Rachael Belz, 40, of North College Hill, who was a Duke Energy customers for about 14 years before switching to Dominion Energy. “At the beginning of the year is when i made the switch, it was the generation charges — I’m saving about one-third every month.”
Contact this reporter at (513) 755-5112 or kelgazzar@coxohio.com.
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