DP&L distribution rate case
In November 2015, Dayton Power & Light (DP&L) filed an application at the Public Utilities Commission of Ohio (PUCO) to increase distribution rates billed to its customers.
What are distribution rates?
Electric bills are comprised of two main parts — the cost of producing or purchasing electricity for customers and the cost of delivering electricity to customers’ homes and businesses. The cost of producing or purchasing electricity, known as generation rates, makes up about 60 percent of an average electric bill.
The distribution rate represents the costs associated with delivering electricity to your home or business. These costs include things such as installing and maintaining electric lines that run through neighborhoods, reading electric meters, processing bills and responding to customer service calls.
What is the PUCO’s role in setting electric distribution rates?
Under Ohio law, a public utility is allowed to recover from customers its operating expenses, plus a reasonable return on its infrastructure investments. When a utility requests a rate increase from the PUCO, several steps are taken to review the company’s finances and to ensure the company is fulfilling its responsibilities.
When evaluating proposed rates, PUCO staff looks at whether the proposed rates would provide the utility with adequate operating revenue. In general, the cost of providing service to customers, maintenance of infrastructure and equipment expenses, depreciation expense, taxes and a return on the company’s infrastructure investment are used to calculate the utility’s revenue requirement. The revenue requirement is the amount of money a company is allowed to collect from its customers during a given year. The PUCO staff prepares a report that makes recommendations to the Commission. The Commission is not bound by the staff recommendations and may implement some suggestions and reject others.
What is DP&L requesting in its application?
DP&L requested an increase of its revenue requirement by $65.7 million. In addition, DP&L requests to establish three new riders: the Uncollectible Rider, allowing the company to recover the actual amount of bad debt costs instead of an estimate in base rates; the Regulatory Compliance Rider, allowing recovery of costs associated with unforeseen regulatory changes; and the Storm Cost Recovery Rider, to allow recovery of costs incurred as a result of major storms.
What are the next steps in the rate case?
The PUCO staff will investigate the facts and issues in DP&L’s application, prepare a staff report, schedule hearings and local public hearings.
A procedural schedule will be provided in case number 15-1830-EL-AIR.
How can I make my voice heard?
The PUCO will schedule local public hearings in the utility’s service area. Consumers may also submit comments online at www.PUCO.ohio.gov or by mail addressed to the Public Utilities Commission of Ohio, 180 E. Broad St., Columbus, OH 43215. Correspondence should include the case number 15-1830-EL-AIR.
Where can I learn more?
Case docket 15-1830-EL-AIR.