Toledo city council members debated yesterday whether they should ask residents to vote on becoming part of a regional buying group for purchasing natural gas.
The move would be similar to a vote taken in November, when residents agreed overwhelmingly to join with other Northwest Ohio communities to purchase electricity as a group.
The Ohio General Assembly this year approved the formation of aggregates for natural gas. The move allows counties and cities to join forces to negotiate with gas suppliers on behalf of residential and small business customers. The idea is the simple theory of bulk buying - the larger the quantity, hopefully, the better the price.
Nine communities, all part of the Northwest Ohio Aggregation Coalition, have been asked to consider putting the question before their voters. Maumee and Oregon have put the measure on the Nov. 6 ballot.
Representatives from Columbia Gas of Ohio told council members at yesterday's hearing that they are not opposed to the process of natural gas aggregation, but they urged council members to proceed with caution.
Gina Thompson, communications and community relations manager for Columbia Gas, said her company has many concerns over House Bill 9, which allowed for gas aggregation, and have forwarded them to the Public Utilities Commission of Ohio.
She said the bill attempts to impose on the natural gas industry standards developed for the electric industry.
If a supplier chosen by the city should fail to be able to supply enough gas to honor its contract, Ms. Thompson said the proposed rules do not require Columbia Gas to become the default supplier or supplier of last resort. She said it is assumed the utility would fill that role, but there is no formal mechanism in place to make that happen.
Councilman Robert McCloskey questioned whether residents could be left without gas to heat their homes. “I think it's a little premature. It's like playing football when the rules aren't yet established,” he said.
Kerry Bruce, utilities rate coordinator for the city, said no one would be left without gas. He said the state's intent is to include those safeguards in the rules governing the aggregation program.
Randy Corbin, assistant director of analytical services with Ohio Consumer's Counsel in Columbus, urged council members to keep in mind that they were considering only whether to let residents vote on whether they wanted to be part of the group, not whether the city should go ahead with a contract from a supplier.
“Please recall what you are considering here,” he said.
Leslie Kovacik, a city attorney who works on utility issues, said if voters decide to become an aggregate, council would have to give its approval to any contract the coalition would propose with a gas supplier.
She said residents who are under contract with suppliers other than Columbia Gas would not be allowed to be part of the aggregation program. Others who do not want to be part of it would have the chance to opt out, she said.
If the matter is to be on the November ballot, council must approve the legislation and have it to the Lucas County board of elections by Aug. 23.
The hearing before council's utilities committee was the first of two planned on the matter.
The second is scheduled for 4 p.m. Aug. 8 in council chambers.