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Dayton Power and Light Company's electric security plan III

February 2, 2017

Role of the Commission

In formulating its decision in a case, the Commission must balance the interests of many parties and stakeholders while adhering to its mission, “to assure all residential and business consumers access to adequate, safe and reliable utility services at fair prices, while facilitating an environment that provides competitive choices.”

The Commission must balance this responsibility with an obligation to ensure Ohio’s regulated utilities the ability to continue to provide adequate, safe and cost-effective services to Ohio’s consumers and continue to invest in infrastructure improvements and innovative technologies.

In every case that comes before the Commission, a formal record is created. The case record includes written testimony, public testimony and cross-examination of expert witnesses. The Commission cannot make arbitrary decisions; information that is not in the formal record cannot be considered by the Commission in formulating its decision in a case.

Working as the neutral arbiter, it is the Commission’s goal to put Ohio in a position as a leader in developing regulatory certainty, rate stability and modernized grid technologies.

ESP 101

State law requires electric distribution utilities to provide their customers a default generation service. This is called a standard service offer, or SSO. An SSO may be in the form of either an electric security plan (ESP) or market rate offer (MRO). Electric distribution utilities are required to file applications with the PUCO to establish either an ESP or MRO.

ESPs establish the pricing and supply of generation service, and may include distribution system investments, grid modernization, economic development and job retention initiatives and energy efficiency measures. The PUCO is tasked with determining whether an ESP, including its pricing and all other terms and conditions, is more favorable in the aggregate as compared to the expected results that would otherwise apply under a MRO.

The PUCO has historically adopted three-year ESPs for Ohio’s regulated electric utilities.

What did DP&L request in its application?

On February 22, 2016, DP&L filed an application to establish an electric security plan for the term Jan. 1, 2017 through Dec. 31, 2026.

In this application, DP&L proposes to secure all supply needed for its standard service offer (SSO) through a competitive bidding process.

DP&L also requests approval of a Reliable Electricity Rider to act as a retail rate stability mechanism through a 10-year power purchase agreement. In the application, the company seeks to acquire generation from their share of Ohio Valley Electric Corporation and generation from its share of the Conesville, Killen, Miami Fort, Stuart and Zimmer electric generation facilities, and then sell that capacity, energy and ancillary services back to the PJM wholesale market. The proposed rider would include the net costs associated with legacy contracts, capital investments and credit to customers the revenue from selling the capacity, energy and ancillary services from the associated plants into the PJM markets.

On Sept. 23, 2016, DP&L filed notice of its intention to withdraw its application to establish the Reliable Electricity Rider.

On Oct. 11, 2016, DP&L filed an amended application. This application requests approval of a Distribution Modernization Rider during the seven year ESP term in the amount of $145 million per year. The proposed rider would allow DP&L to maintain its financial integrity and allow it to access equity and debt capital in order to finance transmission and distribution infrastructure modernization investments.

Was a settlement reached in this case?

On Jan. 30, 2017, DP&L and several other parties filed a settlement agreement.

On March 13, 2017. DP&L and  several other parties filed an amended settlement agreement.

What happens next?

An evidentiary hearing is scheduled to begin April 3, 2017 at the PUCO offices in Columbus. There is no timetable for a decision from the commission.

How can I make my voice heard?

Local public hearings were held in the city of Dayton on September 27.

Those who testified at the local public hearings have had their comments added to the case record.

Customers may also write to the PUCO online or by mail at 180 East Broad Street, Columbus, Ohio 43215. Correspondences should include the case number 16-395-EL-SSO.

For more information

DP&L’s ESP application is available online at www.PUCO.ohio.gov. To view the entire case record, click on the link to the Docketing Information System (DIS) and enter case number 16-395-EL-SSO.