COLUMBUS, Ohio (WCMH) – Ohioans are expected to dish out extra dollars toward their monthly electric bills in the coming weeks.
As energy suppliers throughout the state encounter a surge in natural gas prices, Ohio’s energy companies have proposed rate increases to account for the increasingly volatile market.
Hikes to electric rates, determined at auctions held several times a year and overseen by the Public Utilities Commission of Ohio, will take effect in June and continue through May 2023, according to PUCO spokesperson Matt Schilling.
“What we do is have power companies compete to serve electricity that they generate,” Schilling said. “And we do that through a series of auctions that are designed to attract the lowest price possible.”
What is your energy supplier’s new electric rate?
On average, Ohioans used about 873 kilowatt hours per month of electricity in 2021, according to Schilling.
That means the 2-cent rate increase proposed by American Electric Power Ohio will result in about an $18 monthly increase for AEP customers using 1,000 kilowatt-hours per month – the largest price increase the company has seen to date, AEP spokesperson Scott Blake said.
|Supplier||2021-2022 rate (per kWh)||2022-2023 rate (per kWh)||Monthly Increase to Electric Bill (if using 1,000 kWh/month)|
|AES Ohio||4.805 cents||10.91 cents||$61.05|
|AEP Ohio||4.84 cents||6.621 cents||$17.81|
|FirstEnergy – Ohio Edison||5.2091 cents||6.5116 cents||$13.03|
|FirstEnergy – Cleveland Electric Illuminating||5.3704 cents||6.555 cents||$11.85|
|FirstEnergy – Toledo Edison||5.43923 cents||6.5818 cents||$11.43|
|Duke Energy||5.6081 cents||6.4832 cents||$8.75|
Southern residents using Duke Energy Ohio – which operates primarily in Hamilton, Butler and Clermont counties – will see a 15% increase in their monthly electric bills, a nearly $9 monthly increase for customers using 1,000 kilowatt-hours per month.
AES Ohio, which primarily serves the Dayton and Miami Valley area, has the largest increase of all energy companies in the state, with a 6.1-cent boost to electric rates, Schilling said.
With rates poised to jump from 4.805 cents to 10.91 cents per kilowatt hour, electric bills for AES Ohio customers using 1,000 kilowatt hours per month will likely double, with an extra $61 each month.
Northern Ohioans using any of FirstEnergy’s three electric companies — Ohio Edison, Cleveland Electric Illuminating, and Toledo Edison — are poised to see their monthly electric payments increase anywhere between $11 and $13.
To compare rates between energy companies, visit Energy Choice Ohio.
Why are prices soaring?
Energy costs are skyrocketing across the globe, as an increase in demand, supply chain issues and the war in Ukraine have contributed to a surge in the price of fuel, which is used to generate electricity, Blake said.
“Natural gas and coal prices, two primary fuel sources for electricity generation, are at prices we have not seen in more than a decade and are beginning to impact electric prices across the nation,” Blake said in an email. “As long as global energy supplies remain tight, we expect prices to remain higher than in recent years.”
Ohio’s energy companies also rely on prices set at the federal level, but changes experienced by the Federal Energy Regulatory Commission have postponed federal auctions at which power plants determine their prices, Schilling said.
Because of the delay at the federal level, Schilling said the lack of a federal price point has caused a “cascading effect” on the ability of Ohio’s utility companies to conduct numerous auctions.
Multiple auctions, he said, allows PUCO to blend different utility rate proposals together and average them out to mitigate market volatility. For instance, if one company proposed a $100 increase and a second suggested $50, PUCO would average those rates together and reach a $75 compromise.
“Some of our Ohio utilities have not been able to blend various options together, thereby mitigating the market volatility that we’re experiencing because of these two other factors, you know, the global energy crisis and the uncertainty across the world,” Schilling said.
How to save energy — and money
As Ohioans turn up their air conditioning during the summer months, Blake suggested adhering to the following tips to keep electric bills under control:
- Keep your thermostat as high as is comfortable — or at 78 degrees, as Blake suggested — and turn it up when you leave your house
- Close the curtains on windows facing the sun
- Install LED light bulbs throughout the house
- Use cold water when doing laundry, and clean the dryer’s lint filter after each use
- Run your washer, dryer, and dishwasher after 9 p.m.