Accord could raise rates for small businesses

Associated Press

COLUMBUS

A newspaper’s analysis indicates that a proposed agreement between American Electric Power and Ohio’s utility regulators could raise electricity rates by 30 percent for small businesses while at the same time reducing rates for many large manufacturers.

The Public Utilities Commission of Ohio is expected to vote on the proposal later this month.

Though the utility company’s publicity has said the rate increase would be small for central Ohio, an analysis by The Columbus Dispatch indicates that companies that use a large amount of electricity for a short period and low usage the rest of the time would see the largest rate increases.

Hundreds of small manufacturers, retailers and even churches fall into that category, but they make up a small percentage of overall customers. The newspaper did the analysis with the assistance of outside experts, including Commercial Rate Services of Dublin, a business that helps companies evaluate their energy costs.

Robert Fortney, the PUCO staff member who managed the case, said the small-business rate increase “doesn’t hardly seem fair,” in an ‚à´Aug. 24 email obtained by the newspaper in response to a public-records request.

Joe Hamrock, president and chief operating officer of American Electric Power Ohio, said those customers that will see the largest increases are not typical. Most customers will see rate cuts or smaller increases, he said.

Most of the small-business customers that will see higher rates fall into a usage category that makes up about 15 percent of AEP’s electricity sales to businesses.

The proposed agreement is part of a larger plan that will give AEP $151 million in additional base-rate income next year, which it says it needs in order to cover its own rising costs and begin a three-year transition to a deregulated market.

In a statement, PUCO spokesman Matt Butler said the agency “is concerned with the interests of all customer classes and feels that the [AEP plan] as a whole is in the best public interest and benefits ratepayers and the state of Ohio.”