PUCO Revokes AEP Settlement

Good news is out for those with small businesses in the AEP Ohio service territory. The Public Utilities Commission of Ohio (PUCO) has revoked the Electric Security Plan settlement which it had originally agreed upon in December of last year.

“Our decision effectively hits the reset button on AEP’s electric security plan, allows us to start over from the beginning, ensure that we have a complete picture of any proposal, and balance the interests of all customers and the utility,” Chairman Todd A. Snitchler stated. “Ohio remains committed to continuing down the path towards fully competitive markets.”

The result of this decision means that AEP has been ordered by the PUCO, as mandated by Ohio law, to return its rates to levels similar to those effective in December of 2011. Until a new rate plan is agreed upon between the PUCO and AEP, those are the rates which will remain in effect.

The PUCO states that the decision to revoke the settlement was based upon the agency becoming aware of the actual impacts of the agreement and arguments raised by parties who did not sign the agreement. Finding that the settlement as agreed upon "does not benefit ratepayers and is not in the public interest" the PUCO took the action of revoking the settlement.

AEP Ohio now has 30 days to amend or withdraw the underlying application (rate case) which was filed on January 27, 2011. That rate case is now reopened and any and all parties may participate in the proceedings. The PUCO will issue a new procedural schedule once it has received AEP Ohio's response. AEP Ohio also has the option of withdrawing the current application and filing a new one. We'll keep you posted as developments occur.

Tip of the Week

How much you pay for your business' electric utility bill is determined by a number of factors. Most of us are familiar with actual electric consumption being a factor, but many are unaware of an equally important factor called peak demand. Peak demand is the greatest amount of electrical consumption your building requires at any single point in time. The more electric consuming devices and systems you have running at the same time, the higher your demand. More importantly, devices containing power supplies, compressors, motors, or pumps require a higher initial amount of electric to operate until they are up to speed or capacity. An example would be an air conditioner or furnace. On the air conditioner the compressor has to power up along with a motor for the blower which pushes the cooled air through your ducts. With the furnace, even gas furnaces has blowers to push the heated air through the ducts.

The reason all of this applies to most businesses is because the majority of businesses fall within the General Service tariffs (rate plans) for their electric service. These tariffs charge customers based on both electric consumption and peak demand, so it's advantageous to get both factors as low as you can to reduce your bills. The best way to obtain an accurate picture of the devices and systems within your building and how they affect your consumption and demand is by having an energy monitoring system installed. These systems collect real-time data on the electric usage in the building. Once you have the information you need to make the changes to benefit your bills, you can take the next step by having a building management system installed. These systems can control electrical devices and the mechanical systems in your building. They automate the turning on and off of devices and systems based on a combination of sensors, schedules, and events. By doing so you ensure when these devices don't need to be running that they are turned off or setback to more efficient settings...automatically. They can also stage the turning on of devices and systems which provides a lower increase in demand compared to uncontrolled environments. To lower or limit your building's peak demand, take the following steps:

• Replace old or less efficient devices and systems with more efficient products
• Remove or turn off unnecessary or unused devices
• Install an energy monitoring system
• Install building management systems which can control electric devices (computers, printers, copiers, faxes, vending machines, etc.) and mechanical systems (lighting, HVAC, irrigation, security, etc.)

You should always consult a professional before making changes in your building or its systems. Mechanical systems are complex and require trained professionals to properly work on them. A reputable energy efficiency company, such as EZ-Integration Incorporated, will be able to identify the best courses of action for your building and provide the products and expertise required to implement those plans.