Recently, Gov. Ted Strickland and the state legislature crafted a new state law in response to concerns over future electric prices.

Recently, Gov. Ted Strickland and the state legislature crafted a new state law in response to concerns over future electric prices.

Throughout the legislative process, the office of the Ohio Consumers' Counsel worked diligently to deliver a message of fairness, consumer protections and least-cost solutions.

Ohio's new law provides benefits to residents, but will require continued vigilance to protect customers from excessive rate increases.

On the positive side, OCC was able to help bring key benefits to customers:

OCC led the effort along with environmental organizations and the state legislature to adopt energy efficiency standards as the lowest-cost way to address our state's energy needs. As a result, customers will have more tools to lower their bills. Ohio will be a leader among the 50 states with a requirement that its energy consumption be reduced 22 percent by 2025.

Working with the governor, state legislature and environmental community, Ohio opened the door to lower-cost, environmentally friendly energy supply options. Based on the new law, Ohio utilities must provide 12.5 percent of their supply from renewable energy. Due to Ohio's high level of energy consumption and taking into account the energy efficiency standard, that will place our state sixth in the nation in renewable energy usage.

The new law requires a comparison of a utility-proposed "Electric Security Plan" to a market price for generation service. During the legislative process, the OCC sought to ensure that consumers would not pay higher than market rates. The state legislature agreed.

The OCC's efforts helped remove a proposal to allow rate discounts in current special contracts with businesses to continue, which would have been subsidized by all other customers. Instead, business owners who want special contracts will have to reapply, providing a way to evaluate whether such contracts are appropriate.

The OCC's efforts helped prevent residents from continuing to pay "regulatory transition charges" after these charges were originally set to expire.

The OCC is very proud of what it accomplished in this complex legislation, but is disheartened by some provisions that could not be prevented.

Some negative aspects include the following:

There is no requirement for hearings or audits prior to potentially massive automatic rate increases for fuel, purchased power and emission allowances.

Utilities may be allowed to recover costs from customers as multi-billion dollar power plants are being built. This is a departure from traditional rate-making in which customers were not required to pay for power plants until they were providing electricity.

Through an accelerated process, utilities may seek to charge customers for distribution system upgrades and other costs that could amount to billions of dollars. Customers could see significant rate increases without any recognition that other costs of the utility have decreased and could be used to offset increases.

Side deals made between utilities and large users of energy to settle cases at the Public Utilities Commission of Ohio were not prohibited. These deals recently received a lot of attention in the Cincinnati area, but deals anywhere in Ohio require diligent investigation and review to ensure they are not made at the expense of residential consumers.

Our office will work tirelessly to bring consumers the protections they need in upcoming rules and the cases that will determine electric rates.

Janine Migden-Ostrander is the Ohio Consumers' Counsel.

Janine Migden-Ostrander