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.
Click 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.
- 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.
- 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.
Bottom Line:
Understanding how your bill is structured helps you make informed choices, avoid unnecessary costs, and know where to turn if problems arise.
For more help, visit the Office of the Ohio Consumers’ Counsel at www.occ.ohio.gov