The State of Electricity Competition for Ohio Businesses

On Wednesday, September 28^th, we attended and participated in the 6^th Annual Northern Ohio Energy Management Conference in Akron.  The luncheon keynote address was given by Tony Banks, Vice President Competitive Market Policies for FirstEnergy Solutions.  He commented that:

• The deregulation of electric utilities that began in 1999 in Ohio has resulted in competition that is working.
  • About 1.6 million residential and business customers are buying generation from competitive suppliers and finding cost
    savings.
  • FirstEnergy customers have saved over $100 million annually.
• AEP-Ohio’s current rate proposal includes hurdles to generation shopping that, if approved by the PUCO, would limit competition for their customers

John Funk had an interesting article in Thursday’s Plain Dealer about Tony Bank’s speech: FirstEnergy exec says utilties’ competition has lowered costs.  Mr. Funk states that “…the 70 percent who are taking advantage of competition to get a lower price are buying from FirstEnergy Solutions.  They get a 6 percent discount on the price of power charged by CEI, Ohio Edison and Toledo Edison”.  However, our experience has been better:

• We have helped our commercial and industrial clients contract about 180 accounts with FirstEnergy Solutions.  Over the past 12 months, their average savings were 13% off the entire electric bill as opposed to a 6% discount off the generation portion of the bill!
• We have a few clients who have contracted with other generation suppliers, such as Constellation NewEnergy, Duke Energy Retail and Glacial Energy.  However, these suppliers were not ready to go when competition fully opened up in 2009.  In addition, the terms of their contracts are not right for every customer.

These savings have helped our clients, who are served by FirstEnergy’s distribution utilities, reduce their electric costs and remain competitive in the global marketplace.  We expect to have the same success with companies who are served by AEP-Ohio, depending upon the outcome of AEP’s rate proposal.

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