Critics pounce on utility rate-setting

Associated Press

COLUMBUS

Ohio’s process that determines utility rates is flawed and largely conducted behind closed doors, say critics pointing to the recent approval of a rate increase for American Electric Power. Ohio regulators and the company came up with the framework for a deal in private discussions that began more than a month before the official negotiations began, a newspaper reported Monday.

More than 20 interested parties, including companies and organizations, were part of formal settlement talks on AEP’s rate request that involved closed-door meetings beginning Aug. 3 at the Columbus offices of the Public Utilities Commission of Ohio, or PUCO.

An additional level of backroom dealing had been going on since mid-June between the commission and AEP, and the result was an outline of a revised plan to replace the company’s original one, The Columbus Dispatch reported, based on emails and other documents obtained through a public records request.

It’s not unusual for a company and the PUCO staff to iron out most of their differences ahead of the official negotiations, said Janine Migden-Ostrander, who stepped down in October as Ohio’s consumers’ counsel.

Agreements announced last Wednesday by the PUCO will raise the average AEP residential electric bill in Ohio by at least $1 per month.

Adoption came through a process that was a failure in terms of transparency and serving the public interest, said Sam Randazzo, lead attorney for Industrial Energy Users-Ohio, an association of large industrial consumers.

“It is a bad deal measured by everything the commission is obligated to obey and respect,” Randazzo said in testimony filed in the case.

The PUCO defended its practices. Chairman Todd Snitchler said the commission strives to serve the public good in all cases, including the AEP matter.