Cooperative explains rate variations

NEWTON FALLS -- A representative from an electricity cooperative explained fluctuations in rates to city council.
Pam Sullivan, vice president of marketing for American Municipal Power-Ohio Inc, addressed council at its meeting Monday. AMP-Ohio is a cooperative of Ohio cities, including Newton Falls, that buy electricity in bulk for resale.
Sullivan said that several factors caused increases in electricity rates last year. These included what she called a "lack of customer focus" by federal and state regulators, increased transportation costs and higher environmental standards.
She also said spring floods, summer droughts and a severe hurricane season added to the increased costs.
Sullivan noted how deregulation in 1999 has had an unsettling effect on the electricity industry.
She said the market has changed from cost-based, in which consumers are charged based on the actual cost, into market-based, in which the price is based on what the market can handle.
The changes have led to market uncertainty, which contributes to fluctuations in electricity prices.