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Utility To Transition To Auction For Default Service From Managed Portfolio, Under Proposed Settlement

Settlement Would Require Price To Compare To Be Listed On Shopping Customers' Bills

August 31, 2021

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Copyright 2010-21
Reporting by Paul Ring •

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Duke Energy Ohio, Inc., on August 31 gave notice to the Staff of the Public Utilities Commission of Ohio (Commission) of its intent to file an application pursuant to Section 4929.04 of the Ohio Revised Code under which Duke Energy Ohio will request that the Commission approve Duke Energy Ohio's application to implement a wholesale auction procedure, in the form of a standard service offer, to secure its commodity sales supply for natural gas.

Duke has committed to transitioning to a wholesale SSO auction under a newly filed proposed stipulation addressing several cases at PUCO. Duke currently relies on a traditional GCR process to procure supplies to serve non-shopping customers (the only LDC in Ohio with a choice program to continue to use the GCR process)

Default service under the new SSO auction would begin no earlier than November 2022

The specific design and mechanics of the auction were not addressed in the stipulation, but the stipulation did include the following provisions

a. SSO Transition Costs (e.g. moving from a GCR default service to the auction, including but not limited to, incremental external labor and consultants necessary to expedite preparation of its Auction Application and obtain approval thereof) to be recovered by a non-bypassable rider on residential natural gas customer bills and by a bypassable rider on nonresidential natural gas customer bills;

b. Ongoing costs incurred by the Company to administer the SSO auctions shall be recovered in a bypassable rider on natural gas customer bills;

c. A plan to address the end, including any necessary reconciliation and true-ups, of the GCR process to ensure a smooth transition for all customers;

d. Following approval of the Company’s Auction Application without material modification, Duke Energy Ohio shall conduct its first SSO auction for natural gas supply as soon as January 2022, but no more than three months following the Commission’s order approving the Auction Application. In order to avoid early termination penalties associated with its GCR and to have sufficient time to implement the auction results, the first delivery period under the auction shall commence no sooner than November 2022, but will occur no later than three months following the first auction.

Duke Energy Ohio will conduct stakeholder sessions with interested parties to discuss the transition to the SSO auction in an effort to gain agreement among interested parties. The first of these sessions shall be held within fifteen business days of the filing of this Stipulation (unless otherwise agreed upon by Signatory Parties). Duke Energy Ohio will conduct a minimum of two such sessions within 60 days of filing of this Stipulation. Duke Energy Ohio shall hold auction workshops following initial auction implementation to evaluate learnings that may be incorporated in future SSO auctions.

Duke Energy Ohio intends to file its application no earlier than 30 calendar days from the date of this letter and no later than within five business days following the Commission’s approval, without material modification, of the Stipulation. Duke Energy Ohio also intends to file a notice for a stakeholder meeting to occur within 15 business days of this notice to discuss preliminary issues in the Company’s forthcoming application.

The application will request that the Commission exempt Duke Energy Ohio's commodity sales service and/or ancillary service from all provisions of Chapter 4905 of the Ohio Revised Code, with the exception of Section 4905.10; Chapter 4909; and Chapter 4935 of the Ohio Revised Code, with the exception of Sections 4935.01 and 4935.03; Sections 4933.08, 4933.09, 4933.11, 4933.123, 4933.17, 4933.28, 4933.31, and 4933.32 of the Ohio Revised Code; and from any rule or order issued under those chapters or sections, including the obligation under Section 4905.22 of the Ohio Revised Code to provide commodity sales service or ancillary service.

The auction will be a wholesale SSO auction and not a standard choice offer (SCO). In the latter SCO mechanism the supplier serves the specific retail customer, rather than wholesale load

Price to Compare On Shopping Customer Bills, Shadow Billing

The Signatory Parties agree that Duke Energy Ohio shall add the SSO price-to-compare on its natural gas bills for customer information. Such billing system change shall commence with the second billing month that a customer is billed based upon the SSO

The Price-to-Compare message on bills for shopping customers shall prominently include language similar to the following: "In order for you to save money, a natural gas supplier must offer you a price lower than $X.XX per CCF for the same usage that appears on this bill."

The Price-to-Compare message should be included on all shopping customer bills, including those customers who have gas only and those customers who are combination gas and electric.

Additionally, the Signatory Parties agree that beginning with the second billing month following approval of this Stipulation, Duke Energy Ohio will begin promptly providing the OCC, upon OCC’s request, shadow billing information for natural gas customers in a format to be mutually agreed upon by the OCC and the Company. The shadow billing information shall also include calculations of historic twenty-four months of data comparing aggregate shopping customer costs to what those customers would have paid had they been served on Duke Energy Ohio’s GCR or SSO (beginning with the twenty-four months prior to the signing of this Stipulation) and will be carried forward with aggregate customer data each month thereafter. Duke Energy Ohio shall provide OCC with the shadow billing for the historic twenty-four months of data upon the signing of the Stipulation. The aggregated shadow billing information is not to be considered confidential.

Signatory Parties include PUCO Staff, Duke, OCC, and the Ohio Energy Group

Case 20-0054-GA-ATA et al.

Case 21-0903-GA-EXM

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