Understanding Your Electric Bill: A Guide for Ohio Consumers
Electric bills can be confusing – but understanding the basics can help you better manage your energy costs. In Ohio, your electric bill has three main parts: Generation, Transmission, and Distribution. Each reflects a different step in producing and delivering electricity to your home.
This guide helps explain what each part means, who controls the costs, and what choices you have as a consumer.
- Generation (making the power) – Generation is the electricity you use to power your home – lights, appliances, and electronics.
- Transmission (long-distance power lines) – High voltage transmission lines carry electricity from power plants to local substations.
- Distribution (local power lines) – Local power lines, substations, meters, and customer service systems that deliver electricity from substations to homes and businesses.
- Consumers (who use electricity) – Different consumer types—residential, commercial, and industrial—pay different rates.
Bottom Line: Understanding how your bill is structured helps you make informed choices, avoid unnecessary costs, and know where to turn if problems arise.
Click on each topic to learn more:
- 1. Generation – Making the Power
What it is:Generation is the electricity you use to power your home – lights, appliances, and electronics.
Who provides and regulates it:
Since Ohio deregulated electricity in 1999, utilities no longer generate power for most consumers. Instead, electricity comes from:
- Competitive suppliers (also called marketers)
- Community or government aggregation programs
- The Utility’s default supply, called the Standard Service Offer (SSO)
What it costs:
Generation typically makes up about half your bill.
Your choices:
- Shop for a competitive supplier
- Join a community aggregation program
- Stay on the utility’s SSO
- Reduce usage to lower costs
The Price to Compare on your bill helps you to evaluate supplier offers.
- 2. Transmission – Moving Power Long Distances
What it is:High voltage transmission lines carry electricity from power plants to local substations.
Who owns and regulates it:
Transmission lines are owned by utilities but regulated at the federal level by the Federal Energy Regulatory Commission.
What it costs:
Transmission charges are part of the delivery section of your bill and typically make up about 12% of total costs.
Ohio is part of PJM Interconnection, the regional grid operator that coordinates electricity flow across 13 states and Washington, D.C.
Your choices:
The area where you live determines who your transmission utility is.
- 3. Distribution – Delivering Power to Your Home
What it is:Local power lines, substations, meters, and customer service systems that deliver electricity from substations to homes and businesses.
Who owns and regulates it:
Distribution lines are owned by utilities but rates are set by the Public Utilities Commission of Ohio (PUCO).
What it costs:
Distribution charges include infrastructure, maintenance, tree trimming, metering, billing and customer service. Together with transmission, delivery costs typically account for about half your bill.
Your choices:
The area where you live determines who your distribution utility is.
- 4. Consumers and Protections
Who it is:Different consumer types—residential, commercial, and industrial—pay different rates.
If you are served by a PUCO-regulated utility, you may be eligible for:
- Bill-payment assistance programs
- Winter heating and disconnection protections
- Consumer protections related to billing, service quality, and supplier switching
Programs and protections may differ for municipal utilities, cooperatives, or submetered properties.
