Utility Faults Consumer Counsel Comparison Of Rates In Auction Push

The East Ohio Gas Company d/b/a Dominion Energy Ohio (DEO) filed comments with the Public Utilities Commission of Ohio opposing the Ohio Consumers' Counsel proposal to require all large utilities to use a wholesale auction (except where an SCO auction is already authorized), rather than a Gas Cost Recovery mechanism, to procure default service supplies

As first reported by EnergyChoiceMatters.com, OCC included in its comments a comparison of Duke GCR rates versus rates at the other choice LDCs which use auctions to serve non-shopping customers.

DEO said that, "OCC’s comparison of GCR rates to other companies’ SSO rates does not take into consideration the many factors that lead to significant differences between utilities."

DEO said that such differences include, but are not limited to:

• the availability and cost of upstream pipeline capacity;

• the access of that capacity to preferred supply basins or liquid pricing points;

• the amount of Ohio-produced gas connected to the LDC; and

• the presence or lack of on-system storage.

DEO said that, "For DEO, these factors have supported lower prices: DEO has access to service from eight different interstate pipelines; it has access to low-cost Dominion South Point supplies; it has access to nearby shale gas production; and it enjoys substantial on-system storage resources. All of these factors have played a major role in keeping DEO’s SSO price lower than other Ohio utilities. Other utilities, however, face their own mix of geographical, operational, and economic factors, all of which affect the cost of commodity and most of which are outside their control."

DEO further said, "Having already gone far afield by proposing wholesale auctions in a GCR rulemaking, OCC goes even farther and trains its sights on the Choice programs administered by non-GCR utilities. OCC recommends that gas supply prices “should be established via a wholesale auction rather than a retail auction,” and this recommendation in turn serves as a jumping-off point into criticisms of the Choice programs administered by DEO, Columbia Gas of Ohio, Inc., and Vectren Energy Delivery of Ohio, Inc. (OCC Comments at 6.)" DEO further said, "Obviously, this discussion is far removed from anything to do with PGA clauses or GCR pricing and as such is entirely out of place in this rulemaking. Nor is it necessary. No one with any familiarity with Ohio natural gas regulation has any doubt that OCC at present favors auction-based commodity service over every other form. In DEO’s view, lodging these views yet again in this rulemaking is (at best) an unwarranted use of the Commission’s and the parties’ resources. DEO and others have responded to similar points by OCC in numerous other settings, where the issues were at least arguably relevant. Rather than burden the Commission with such discussion again, DEO will merely note, for the sake of the record, that it does not support the remedies sought by OCC and would incorporate its prior comments on these and similar issues by reference here."

DEO also called OCC's proposal inconsistent with the commodity sales exemption statute

In separately filed comments, IGS Energy similarly said that OCC's proposal is incompatible with statutory requirements