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Office of the Ohio Consumers’ Counsel

The Ohio Senate
Energy and Natural Resources Committee

Testimony on Substitute House Bill 114
(Renewable Energy and Energy Efficiency Standards)
Colleen Shutrump

On Behalf of the
Office of the Ohio Consumers’ Counsel

January 10, 2018

Hello Chair Balderson, Vice-Chair Jordan, Ranking Minority Member O'Brien, and members of the Committee. I am Colleen Shutrump, an energy resource analyst for the Office of the Ohio Consumers’ Counsel, where my focus in on consumer issues involving alternative energy. The issues in House Bill 114 (Bill) affect millions of Ohio electric customers. I am testifying today with updates on two of the Consumers’ Counsel’s consumer protection recommendations for the Bill. Our other recommendations are in our earlier Senate testimony, dated October 18, 2017.

The Ohio Consumers’ Counsel supports energy efficiency as a way for Ohioans to save money. In this regard, we support energy efficiency that Ohioans employ on their own in the market without government-ordered, consumer-funded utility programs. And we support a reasonable level of energy efficiency through government-ordered, consumer-funded utility programs. Regardless of whether utility programs are mandated or voluntary under the law, Ohio consumers should be protected from paying too much for these energy efficiency programs. And Ohioans should be protected from paying excessive utility profits on energy efficiency.

Accordingly, there should be an annual limit on the amount that utilities can charge customers for energy efficiency program costs, utility profits, and lost revenues. A cap equal to a maximum of 4% of each utility’s annual revenues would allow significant funding for energy efficiency programs, while protecting customers with a limit on how much money utilities could collect for energy efficiency programs. The PUCO should be given the discretion to impose a lower cap.

Our update is that FirstEnergy has now asked the PUCO to reconsider its Order (in Case 16-743-EL- POR) where the PUCO established a 4% cap on the sum of energy efficiency program costs and utility profits. FirstEnergy is claiming that the PUCO lacks the legal authority to impose a cap. Its reconsideration request is a prerequisite for appealing the PUCO’s limit on energy efficiency charges to FirstEnergy’s consumers. That means FirstEnergy could appeal the PUCO’s decision that limited FirstEnergy’s energy efficiency charges to consumers. Consumer protection on this issue (with authority for the PUCO to set a 4 % limit on utility charges) should be added to House Bill 114.

Additionally, Section 7 of the Bill should be removed. This section of the Bill would require the Ohio Development Services Agency to allocate 25% of funds from the federal Low-Income Home Energy Assistance Program (HEAP) to low-income weatherization projects. This re-allocation would be at the expense of the vital use of the funds for assisting the neediest Ohioans with payment of their energy utility bills. The highest and best use of HEAP funds should be for assisting low-income Ohioans with bill payments for maintaining their utility service (especially during Ohio's winter heating season). The imperative for assisting the neediest Ohioans with their utility bill payments is reflected in recent data showing there were approximately 450,000 residential utility consumers disconnected by electric and natural gas utilities between June 1, 2016 and May 31, 2017.

Moreover, this issue of HEAP weatherization funding was recently addressed in section 259.80 of the Ohio budget bill, Amended Substitute House Bill 49, where the General Assembly increased the allocation of HEAP funding for weatherization to 20%. The issue should not be revisited in House Bill 114.

Our update is that, according to the attached news story in ideastream on January 1, 2018, consumer applications for bill payment assistance are up about 20% in Cuyahoga County this season. That reflects the vital need for preserving funds for bill payment assistance.

Finally, we have heard some informal discussion that other energy-related issues affecting consumers might be added to House Bill 114. If additional legislative issues are added for consideration in this Bill, we respectfully look forward to an opportunity for further public testimony on the Bill.

In closing, thank you for the opportunity to make recommendations for protection of Ohio utility consumers.