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Published: Friday, 10/12/2007

Consumers Counsel, FirstEnergy find common ground on rate-setting

BY JIM PROVANCE
BLADE COLUMBUS BUREAU

COLUMBUS FirstEnergy Corp. may have found an unlikely ally yesterday in Ohio s voice for the residential consumer as it seeks to stay on its path to enter an open electricity market that the state says doesn t exist.

The company s rates, and particularly those of its subsidiary Toledo Edison, are so high that customers may be better off in the market than under a regulatory plan that could saddle them with bills for new power plants, said Ohio Consumers Counsel Janine Migden-Ostrander.

Whatever is the least cost is what we should do, she told the Ohio Senate s Energy and Public Utilities Committee.

State lawmakers are considering Gov. Ted Strickland s proposal to tighten the state s regulatory grip on the generation of electricity and to push advanced and renewable energy to the front burner.

More often foes in rate cases before the Public Utilities Commission of Ohio and in court, Ms. Migden-Ostrander and FirstEnergy are largely on the same page when it comes to how rates should be set in northern Ohio when the utility s current rate plan expires at the end of 2008.

Both FirstEnergy and the consumers counsel dismiss as unworkable the governor s plan to have the PUCO first determine whether a competitive market exists.

The utility wants the right to proceed directly to competitive auction without the PUCO as middle man. Ms. Migden-Ostrander would prefer that the PUCO negotiate rate plans with each utility at the same time that those utilities test the market.

Whichever results in the best price for consumers should win, she said.

The Senate committee yesterday heard for the first time from consumer and environmental groups who urged lawmakers to go further than Mr. Strickland s proposals for promoting energy efficiency and green power.

The governor has proposed a requirement that each utility find at least 25 percent of its power by 2025 from advanced energy sources, a menu that could include fuel cells, cleaner coal and improved nuclear plants, and renewables like wind and solar.

Of that 25 percent, half, or 12.5 percent, would have to come from renewables.

Ms. Migden-Ostrander, however, urged the committee to set the benchmark at 25 percent renewable by 2025.

Sen. Jeff Jacobson (R., Vandalia) said lawmakers were proven wrong in 1999 when they assumed a competitive electricity market would emerge and said he feared it might be a mistake to assume that wind and solar power will be cheaper than coal or nuclear.

I would much rather have consumers pay for a wind farm of 600 megawatts than a typical plant, because a wind farm will be a less costly option, it will save customers money, and I don t have to worry about what the fuel costs are going to be for coal, said Ms. Migden-Ostrander.

Contact Jim Provance at: jprovance@theblade.com, or 614-221-0496.



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