Update:  The Public Utilities Commission of Ohio (Commission) issued its Finding and Order on its investigation into Ohio’s retail electric service market in Case No. 12-3151-EL-COI on March 26, 2014.  The Commission issued its findings and orders by topic, as discussed herein.

Standardizing the Retail Electric Service Market

The Commission agreed with OMAEG’s recommendations that efforts should be taken to standardize the practices, processes, and market rules of the Ohio electric distribution utilities (EDU) in order to streamline certified retail electric service (CRES) market policies to, in turn, increase competition, cost efficiency, and potential savings for customers. Therefore, the Commission will be scheduling working group meetings to address agency market concerns in the newly-created Market Development Working Group (MDWG).  Additionally, the Commission will consider the goal of consistency in making policy decisions, but in considering any specific issue or policy decision, the Commission will weigh the value of standardization against potential costs.

Ohio Retail Electric Service Market Definition and Measurements

The Commission determined that for the Ohio retail electric service market, “effective competition” will be defined as having

1. Participation in the market by multiple sellers so that an individual seller is not able to influence significantly the market price of the commodity;
2. Participation in the market by informed buyers;
3. A lack of substantial barriers to supplier entry into the market;
4. A lack of substantial barriers that may discourage customer participation in the market; and
5. Sellers offering buyers a variety of competitive retail electric services.

The Commission also determined that the following criteria should be adopted as reasonable indicators of the health of the competitive retail electric service market:

1. Number of PUCO certified CRES providers in the State of Ohio.
2. Number of PUCO certified CRES providers by EDU service territory.
3. Number of active CRES providers by EDU service territory.
4. Number of customers shopping by class, by EDU service territory.
5. Percentage of load shopping by class, by EDU service territory.
6. All EDUs in Ohio have structural separation.
7. Customers are engaged and informed about the products and services that they receive.

The Commission determined that the other proposed indicator, which provided that “100 percent of the standard service offer (SSO) load is procured via a competitive process for all EDUs in Ohio” should not be adopted.  The rationale provided for this decision was that the Commission needed to preserve its statutory authority pursuant to R.C. 4928.143(B)(2)(c), which provides that an electric security plan may include a nonbypassable surcharge for the life of an electric generating facility that is owned or operated by an EDU and dedicated to Ohio consumers.

Confidentiality of Supplier Information

The Commission found that Staff’s proposal to make certain information and reports public should not be adopted.  The Commission explained that under Ohio law, all information contained in the reports provided to Staff is deemed public information, except as provided in R.C. 149.43 and as consistent with the purposes of R.C. Title 49.  The Commission believes that existing Ohio law already accomplishes what Staff intended to achieve by means of its proposal:  that information provided to the Commission is considered public information.  The Commission also acknowledged the rights of parties to file motions for protective order under Ohio law.

However, in order to prevent numerous motions for protective orders from being filed, the Commission held that any information filed pursuant to Sections 4901:1-25-02(A)(2)(d), (A)(3), and (A)(4), O.A.C., will be held as confidential, without a motion for protective order, until such time as a request for disclosure is filed. Parties have the right to file requests for disclosure of certain information.  Any request for disclosure must identify the information being sought and the report from which it is being sought.  When the Commission receives a request for disclosure, the Commission will provide the party that filed the report three business days prior notice of its intent to disclose. Three days after such notice, Staff may disclose or otherwise make available such documents or information for any lawful purpose, unless the Commission receives a request for a protective order pertaining to the requested information within the three-day notice period.

Corporate Separation

The Commission determined that, at this time, no further action is necessary requiring electric utilities to divest, on the basis that corporate separation may typically be achieved by structural separation of generation assets into a separate corporate entity from the transmission and distribution entities, accompanied by monitoring and structural safeguards. However, the Commission also agreed with OMAEG that it is imperative that utility and affiliate activities undergo vigilant monitoring in order to ensure their compliance with corporate separation laws and regulations.

In light of its determinations, the Commission ordered that any EDU that does not maintain separate shareholders with any affiliate generation or competitive supplier should file with the Commission its policies and procedures for ensuring compliance with the code of conduct rules contained in Chapter 4901:1-37, O.A.C., by September 26, 2014, or a statement conveying that there has been no change in those policies and procedures from those previously approved by the Commission.

Standard Service Offer as the Default Service

As recommended by OMAEG, the Commission determined that the SSO should remain the default service at present. The Commission noted that the auction process has, to date, been successful in producing competitive prices and benefits for even those customers who currently choose not to shop for their own supplier. Further, given the state of the current market, the Commission agreed that eliminating the SSO and requiring customers to take service from various CRES providers could create customer confusion at this time.

Despite its decision, the Commission noted that as customer awareness and participation increase, reevaluation of the default service mechanism may be warranted.  In making this finding, the Commission emphasized its creation of the Office of Retail Competition within the Commission, which is tasked with educating Ohio’s ratepayers as to how they can fully exercise their right of choice within Ohio’s competitive retail electric and natural gas markets.  The Commission also emphasized its new Energy Choice Ohio website, which was created with the purpose of informing and educating ratepayers about the ability to compare and select competitive retail electric and retail natural gas suppliers:  http://www.energychoice.ohio.gov.

Purchase of Receivables

The Commission encouraged each EDU to include in its next distribution rate case or SSO an application to implement a purchase of receivables program or equivalent.  Additionally, the Commission directed the EDUs to work with CRES providers through the MDWG to develop proper procedures for providing to CRES providers the total customer payment amount, the amount billed by the CRES provider, the amount of payment allocated to the CRES provider, and the date payment was applied. The Commission finds that the electric utilities should also flag customers that are on a payment plan. The EDUs and CRES providers were directed to work through the MDWG so that CRES providers will begin receiving this information no later than September 26, 2014.

Electronic Data Interchange

The Commission determined that a new group, the MDWG, should be established and facilitated by Staff for the purpose of streamlining and aiding the development of Ohio’s CRES market. The Commission determined that the MDWG should consist of CRES providers, the EDUs, and any other interested stakeholders. The Commission further ordered that the existing Ohio Electronic Data Interchange Working Group should continue to analyze and propose electronic data interchange standards and change requests, whereas the MDWG should analyze and propose policies and procedures for improving any information exchanges and competitive retail enhancements that would benefit development of the retail electric market.  The Commission ordered Staff to file an initial MDWG report by September 26, 2014.

Seamless Moves / Contract Portability

The Commission found that Staff should facilitate discussion within the MDWG to develop an operational plan for the purpose of implementing either a statewide seamless move, contract portability, instant connect, or warm transfer process.  Once Staff has developed an operational plan, the Commission directed it to file a Staff Report, with the operational plan, in a case with an EL-EDI designation.  The Commission directed Staff to file such a report by March 26, 2015, noting that the operational plan should generally recognize the Commission’s preference for shopping customers to maintain their status as shopping customers, and if they must return to the SSO provider after a change in address, then for as short a period as possible.  The Commission also ordered that said Staff Report should also consider and propose the proper forum for implementing any proposals contained therein, and identify any rules that may need to be amended to implement the proposed process.

Bill Format

The Commission found that displaying the applicable CRES provider’s logo and revising the price-to-compare on customer bills are necessary for proper disclosure of the costs of CRES service.  Further, the Commission will now require the identification of the supplier of each service on customer bills.  The Commission directed Staff to propose amended rules in Case No. 14-485-EL-ORD to revise Chapter 4901:1-10-33, O.A.C., and other rules related to bill format, as necessary, to bring them into conformity with Ohio law and its Order in this case.

The Commission further determined that it may order any entity to provide bill content to its customers through a consolidated bill.  Consequently, the Commission directed each EDU to file an application by September 26, 2014, to revise its consolidated bill format to bring it into conformity with Ohio laws and regulations and the Commission’s Order in this case.

The Commission also determined that Staff’s recommendation for the EDUs to adjust their bill language to reference supply and delivery charges in different sections of the bill should not be adopted at this time, it is presently premature to divide customer bills between supply and delivery charges, and the Commission is concerned that the costs of such division may exceed the benefits.  However, the Commission noted that Staff’s recommendation should be reevaluated at a later date.

Moreover, the Commission found that standardizing the price-to-compare across the state of Ohio will bring transparency to the market and clarity to customers.  Consequently, the Commission directed EDUs to use a rolling annual average price-to-compare. To implement this rolling annual average, an EDU must calculate the price-to-compare by using its SSO rate for the previous 12 months and dividing it by the customer’s usage.  The Commission directed the EDUs to include this bill format change in their applications to revise their bill format.  The Commission also noted that bills must include Staff’s proposed language to inform customers that they can review available competitive supplier offers by visiting the Commission’s Energy Choice Ohio website at http://www.energychoice.ohio.gov.  Further, any written explanation of the price-to-compare provided to residential customers must include an explanation of the standardized price-to-compare.

The Commission determined that if a customer is shopping for retail electric service, then the CRES provider’s logo or name must be displayed on the customer’s bill next to the EDU’s logo or in the area containing the supply charges of the bill.  Further, the Commission noted that if the EDU’s logo is displayed in color, the CRES provider’s logo or name must also be displayed in color.  To the extent CRES providers prefer to use their name instead of their logo on the bills, they may do so.  The Commission explained that adopting these measures will bring clarity and uniformity to customer bills, and promote further development of Ohio’s CRES markets.

Customer Enrollment

The Commission found that at present, only customers should be able to authorize the release of their customer account numbers by an EDU, and that privacy concerns and slamming prevention necessitate such a finding at this time.  The Commission acknowledged, however, the concerns voiced in this proceeding regarding the difficulty of enrolling customers who may not have immediate access to an account number when attempting to enroll with a CRES provider.  Accordingly, the Commission directed the Ohio Electronic Data Interchange Working Group to continue to working to resolve these issues, and directed Staff and the EDUs to continue to work together in developing a website registration system that ensures customer protections on a utility-by-utility basis.

Advanced Metering Infrastructure

The Commission found that the EDUs should offer time-differentiated rates through their AMI/Smartgrid programs, and should recover the costs through their AMI/Smartgrid riders. The Commission further encouraged every EDU with AMI/Smartgrid deployment, yet without a time-differentiated rate pilot program, to file an application with the Commission to implement a pilot time-differentiated rate program in its next SSO case.  The Commission further encouraged any EDU without an AMI/ Smartgrid program, or without significant AMI/Smartgrid deployment, to include a proposal to implement a pilot time-differentiated rate program in its application to implement an AMI/Smartgrid program. The Commission noted that the EDUs’ time-differentiated rate pilot programs should be made available to SSO customers until the market sufficiently develops for CRES providers to begin offering this service, and that time-differentiated rates are a generation service that should be offered by generation service providers, which in this instance is the SSO provider. However, the EDUs should offer pilot time-differentiated rates only for so long as it takes for the market to develop and for a reasonable number of CRES providers to begin offering this service in each service territory.

Multi-State Standardization Collaborative

The Commission adopted Staff’s recommendation to work with other members of the Mid-Atlantic Conference of Regulatory Utilities Commissioners and form an official committee to focus on member CRES markets, standardization, and best practices.