Ohio Utility Seeks Clarification That Rule Does Not Require Utilities To Report Unreasonable Sales Practices Of Retail Suppliers, Market Deficiencies

July 15, 2019

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Reporting by Paul Ring • ring@energychoicematters.com

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In comments on a rulemaking regarding Ohio corporate separation rules, Duke Energy Ohio requested that the Public Utilities Commission of Ohio clarify that an existing rule concerning the reporting of unreasonable sales practices and market deficiencies does not impose an obligation on utilities to report the behavior of third-party market participants.

Currently, the corporate separation rules require an electric utility’s compliance officer to "promptly report . . . unreasonable sales practices, market deficiencies, and market power" to the appropriate Commission staff.

"Duke Energy Ohio interprets this subparagraph as obligating an electric utility’s compliance officer to promptly report instances of the listed problematic conduct by his or her own electric utility, but not obligating an electric utility’s compliance officer to report problematic conduct by other entities," Duke Energy Ohio said

"Requiring electric utilities’ compliance officers to report all market participants’ problematic conduct would be improper, given that electric utilities lack the authority or ability to monitor other entities for compliance or to investigate ambiguous circumstantial evidence. Electric utilities sometimes find themselves privy to information indicating problematic conduct by other entities (including but not limited to competitive retail energy service providers). When such information appears to be reliable and meaningfully indicates that a third party may be engaging in the above-listed problematic conduct, Duke Energy Ohio’s usual practice is to report to the Commission. However, this should be viewed as voluntary and not obligatory," Duke Energy Ohio said

"Interpreting an electric utility’s reporting obligation as applying to the conduct of all market participants would have negative effects. Among other things, such an interpretation would encourage 'defensive reporting,' whereby utilities would report the vaguest of rumors and suspicions to avoid any possibility of violating the regulation. Defensive reporting would result in a high volume of low-quality reports that will ultimately detract from the effectiveness of high-quality reports based on reliable information," Duke Energy Ohio said

"Accordingly, Duke Energy Ohio believes that an electric utility’s reporting obligation should be interpreted to apply only to the utility’s own practices. Respectfully, Duke Energy Ohio requests that the Commission confirm this interpretation as reasonable and proper," Duke Energy Ohio said

Case No. 18-1190-EL-ORD

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