Ohio to Review Payment Priority for Competitive Supply, Utility Receivables

The Public Utilities Commission of Ohio delegated that issues related to the payment priority for competitive supply and utility receivables collected on an electric utility consolidated bill shall be addressed in a newly opened rulemaking, declining to address the issue as part of the FirstEnergy Ohio utilities' electric security plan.

Retail suppliers had sought in the electric security plan proceeding the introduction of a Purchase of Receivables program, which PUCO flatly rejected.

"Although the marketers have demonstrated that the purchase of receivables by the utility is their preferred business model, there is no record in this proceeding demonstrating that the absence of the purchase of receivables has inhibited competition," PUCO said.

"There is no record in this proceeding that the Companies are under any legal obligation to purchase receivables. There is no record that circumstances have changed since the adoption of the [prior] stipulation [which modified the partial payment order in lieu of implementing POR] to justify abrogating the stipulation," PUCO said.

Although the Commission does not believe, at this time, that testimony from retail suppliers justifies the abrogation of the prior stipulation which eschewed POR and established the partial payment priority, "the Commission believes that the issues raised merit further review."

In particular, testimony had been presented raising issues regarding the correct application of the stipulation's partial payment order in cases of deferred payment plans.

Accordingly, the Commission directed Staff to hold a workshop in the newly-opened five-year rule review for Chapter 4901:1-10, O.A.C, specifically for the purpose of reviewing the FirstEnergy EDC's implementation of the partial payment priority, including, but not limited to, the implementation of the stipulation with respect to customers on deferred payment plans. Notably, the Commission did not direct a review of a POR alternative, per se, though retail suppliers will likely seek POR in the rulemaking.

"At the conclusion of the workshop. Staff shall identify whether, in order to protect consumers, protect the financial integrity of the Companies, and promote competition in the Companies' service territories, amendments to Chapter 4901:1-10, O.A.C, are necessary, additional waivers of Chapter 4901:1-10, O.A.C, are necessary, modifications to FirstEnergy's tariffs or practices are necessary, or additional measures should be undertaken as recommended by Staff," PUCO said.