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Retail Suppliers, Consumer Advocate Oppose Proposed Utility-Offered Demand Response Programs, Including Recurring Incentive Payments For Residential Demand Response
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Retail suppliers have opposed several new demand response programs proposed by Dayton Power & Light (AES Ohio) which DP&L has included in a proposed multi-year reliability plan filed at the PUC of Ohio (a proceeding similar to a rate case)
As first reported by EnergyChoiceMatters.com (click for full details), DP&L has proposed a new residential demand response program that would include recurring incentives in addition to a rebate for an enabling device
Under the proposed residential DR program, participating customers would be offered a number of eligible demand response capable measures (i.e. smart thermostat, etc) through an online marketplace or through interaction with a third-party implementation contractor
Depending on the measure, customers would receive a one-time, upfront rebate between $50-$100 for purchasing a demand response capable device
Notably, DP&L proposes that customers would additionally receive recurring participation incentives of up to $20 per demand response season (at $5 per month for the months of June through September).
The Retail Energy Supply Association said in objections filed at PUCO that, "Through this proceeding, the Dayton Power and Light Company d/b/a AES Ohio’s ('AES Ohio' or the 'Company') proposes to establish a Residential Demand Response ('Residential DR') program to gather money to pay a third-party business that operates in the competitive business marketplace to run all aspects of the program while AES Ohio extracts revenue through nonbypassable rates imposed on all customers. AES Ohio also asks that it be granted a financial incentive paid by customers (at a level even greater than the authorized return-on-equity) for the privilege of AES Ohio hiring a third-party with customer funds to implement the program. Of course, AES Ohio acknowledged that it has not conducted any cost-benefit analysis of the proposed program and instead wants to spend customer money now and address the potential benefits of the proposal on an after-the-fact review. While ex post analyses can be beneficial, AES Ohio has the burden of proof in a rate case and failing to introduce and support such an analysis in its direct testimony is fatal."
RESA said that the DP&L residential DR program should be rejected in its entirety, as RESA said that two conditions proposed by PUCO Staff are inadequate to resolve the problems with the program. PUCO Staff have recommended approval of the residential DR program subject to two conditions: prohibiting recovery of financial incentives, and imposing an annual spending cap.
RESA said that a variety of statutory changes no longer support utility-offered residential DR programs such as that proposed by DP&L
In separately filed testimony, IGS Energy said, in opposition to DP&L's residential DR program, "The Commission has consistently held in recent years that, outside of low-income programs, energy efficiency and demand response programs should be offered by the competitive market, not by monopoly utilities."
In separately filed testimony, the Ohio Consumers' Counsel said that, "The PUCO has no legal authority to approve residential demand
response programs under R.C. 4909.192. PUCO Staff’s failure to remove
these costs violates R.C. 4909.192 and results in unjust and unreasonable
rates in violation of R.C. 4909.15 and R.C. 4905.22."
OCC said that statutory changes limit utility-offered DR programs to "energy-intensive customers."
IGS Energy also opposed DP&L's proposed new Interruptible Demand Response (IDR) program targeting an estimated 41MW of non-residential customer-controlled DR capacity over a three-year program period. Under the proposal, participating customers would receive a credit of $3.50 per kW of "curtailable capacity", and would also receive a credit of $0.10 per kWh for energy saved during any called events.
PUCO Staff have generally recommended denial of the IDR program, but said that the program could be workable if DP&L provides further details and statutory support for the program.
As a result, IGS said that, if PUCO elects to adopt the IDR program, the program should be modified
Notably, IGS said that it appears from DP&L's application that DP&L is proposing to operate as a curtailment service provider (CSP) in PJM under the IDR program
IGS said that, "if the Commission approves an interruptible rate program for nonresidential customers, it should leave the active PJM participation piece to the competitive marketplace where such activity is already occurring and explicitly prohibit AES Ohio from acting as a CSP."
RESA, in separate objections, also expressed concerns with DP&L serving as a CSP
RESA observed that, "AES Ohio proposes to act as the curtailment service provider ('CSP') and bid the demand response reductions into the PJM capacity and energy markets but acknowledges PJM’s capacity market rules authorize only one CSP bidder. As a result, a customer participating in PJM demand response activities through a competitive provider would need to terminate that participation in order to participate in AES Ohio’s proposed program."
In separate testimony, Ohio Energy Group sought approval of the IDR program, with modifications.
Notably, Ohio Energy Group proposes that DP&L serve as the CSP
However, Ohio Energy Group said that 100% of PJM revenues received by DP&L as a result of the
IDR program should be credited back to customers
Ohio Energy Group said that DP&L has indicated that DP&L may keep 20% of PJM derived revenues
received from bidding IDR program load into PJM (assuming DP&L functions as the
CSP).
RESA also proposed a downward return on equity adjustment for DP&L, to the lower end of PUCO Staff’s recommended range, for AES Ohio’s previously reported customer billing problems (see background here)
In supplemental testimony, DP&L reported progress on outstanding CIS issues, which follows a recent PUC Staff report noting an increase in errors after progress was previously made as a result of remediation efforts last year (see background here)
DP&L said that, "The Company has made significant improvement from the original 2,320
customers that had delayed billing of more than 3 months and now only 143 remain. The
Company is also on track for mid-August to have fewer than five hundred (500)
customers in total not billed for more than three (3) months, which will reflect a 99.9%
timely billing for all the Company's customers."
Case 25-960-EL-ATA et al.
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June 19, 2026
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Copyright 2026 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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