PUC Issues Order On Fees Charged By EDC To Retail Suppliers; Bypassability Of Certain Default Service-Related Costs

December 14, 2022

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Reporting by Paul Ring • ring@energychoicematters.com

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The Public Utilities Commission of Ohio issued an order in the current rate case of Dayton Power & Light (AES Ohio)

PUCO approved the inclusion of $770,254 in retail supplier (CRES) fees charged by the utility to retail suppliers in the calculation of AES Ohio’s test year operating income for the purpose of determining the Company’s revenue requirement

These fees include (1) switching fees ($5), (2) technical support and assistance charges, (3) manual historical customer energy usage data charges, and (4) electronic interval meter data charges.

Retail suppliers had objected to the inclusion of the supplier fees in the test year, arguing, among other things, that PUCO should investigate the CRES fees to confirm that they are just and reasonable. Suppliers had argued that the $5 switching fee is unsupported

PUCO said that, "Consistent with our prior decisions regarding this issue, including with respect to AES Ohio, we affirm that the continuation of the switching fee is not discriminatory, counter to state policy, or otherwise unreasonable."

"As Staff describes, AES Ohio is not seeking to modify its Commission-approved supplier fees. Accordingly, given that unmodified tariffs are generally not subject to review in a rate case, we disagree with the assertion that AES Ohio was required to offer a cost basis for these fees as part of this case. Further, as Staff witness Smith testified, a switch in service from the SSO to the CRES provider is not comparable in process or cost to a switch in service from a CRES provider to the SSO. Consequently, it is not unreasonable for AES Ohio to maintain the charge for switching from a CRES provider even where that charge is not applied to customers that switch to a CRES provider. Accordingly, we decline to adjust AES Ohio’s switching fees as part of this case," PUCO said

PUCO declined the proposal from PUCO Staff to move certain PUCO/OCC assessment costs from SSO default service rates into distribution rates

"Staff recommends that AES Ohio’s assessments to fund the Commission and OCC should be included in base rates, rather than funded using a bypassable rider. In making this recommendation, Staff acknowledges that it acquiesced in a different treatment of this issue as part of the Stipulation in the 2015 Rate Case, where the Commission allowed the recovery of these costs pursuant to a bypassable rider," PUCO noted

PUCO held that, "The Commission concludes that AES Ohio should continue to employ a bypassable rider mechanism in connection with funding Commission and OCC assessments. We are not persuaded by the record of this proceeding that we should deviate from the bypassable rider mechanism approach adopted for AES Ohio in the 2015 Rate Case. Further, we note that the precedents cited by Staff involved a much broader proposed reallocation of indirect costs to SSO customers than the specific question of the assessments in this proceeding. (AEP Rate Case, Opinion and Order (Nov. 17, 2021) at ¶ 183-186; Duke Rate Case, Opinion and Order (Dec. 19, 2018) at ¶ 231.)"

IGS had argued that AES Ohio should recover a portion of its uncollectible expenses, related to the SSO, using a bypassable rider, rather than permitting the entire recovery through base distribution rates.

PUCO denied this request at this time, but established the issue for consideration in DP&L's electric security plan proceeding

"The Commission adopts Staff’s recommendation at this time to include SSO uncollectible expenses in base rate recovery instead of providing for the collection of a portion of these amounts pursuant to a bypassable rider ... A we find, at this time, that AES Ohio’s uncollectible expenses should be subject to recovery for recovery in base rates. " PUCO said

"However, the Commission believes that this question should be revisited by the parties in AES Ohio’s pending ESP proceeding where issues regarding facilitating competition in the market are more appropriate for consideration than a distribution rate case," PUCO said

Case 20-1653-EL-ATA et al.

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