AEP Ohio Agrees to Retailer TOU Program Concurrent with Smart Meter Rollout - Environment+Energy Leader

AEP Ohio Agrees to Retailer TOU Program Concurrent with Smart Meter Rollout

by | Apr 11, 2016

AEP Ohio has entered into a Joint Stipulation and Recommendation Agreement under which the utility would complete phase two of its gridSMART deployment program and would allow the billing of Time of Use (TOU) rates by retail suppliers in its service territory. The proposal awaits the final approval of the Public Utility Commission of Ohio (PUCO) under Case No. 13-139-EL-RDR.

The parties to the agreement include the PUCO staff, Direct Energy, Interstate Gas Supply, the Ohio Hospital Association, the Environmental Defense Fund, the Ohio Environmental Council, and AEP Ohio.

In its filing, the utility said that it had 1.5 million meters installed throughout its service territory and that, of this total, it had thus far converted approximately 132,000 premises to smart meters. Within the next four years, AEP Ohio stated that it planned to install an extra 894,000 advanced meters under the current proposal.

The utility has agreed to work with the PUCO staff and competitive retail electric suppliers to administer a Time of Use Transition Plan. The retailers will develop programs similar to AEP Ohio’s SMART Shift (two-tier TOU), SMART Shift Plus (three-tier TOU plus Critical Peak Pricing), and SMART Cooling (thermostat) programs within six months of the adoption of the stipulation, using the same on-off peak structure.

As part of the transitional period, AEP will provide rate-ready and bill-ready billing for TOU rates offers by retailers that meet the same criteria as the utility’s SMART Shift and SMART Shift Plus. In addition, the utility will support bill-ready invoicing for customers on retailer Smart Cooling programs, where compliance and customer credit calculations will be performed by the retailers. The company will work with the providers offering these programs and engage them in testing through the development period.

AEP Ohio also will create and distribute a customer communications campaign to inform and motivate customers about switching to the retail programs.

Consistent with the commission’s finding and order in this case, AEP Ohio will propose, within 90 days, a simple two-tier, non-technology TOU rate reflecting default load auction prices for smart meter customers – to be used only if the retailer TOU market has not evolved to be “sufficiently competitive” after the customer communications phase.

Until the PUCO makes a ruling regarding the sufficiency of competitive retailer TOU offers, AEP Ohio’s 13-1937 filing (GRID Smart Experimental Tariffs) will be held in abeyance. If the commission deems that the retailer programs are not sufficiently competitive, the commission shall grant the Company’s 13-1937 application and adopt AEP Ohio’s newly-proposed Advanced Metering Infrastructure (AMI) TOU program only for as long as it takes the market to develop.

Finally, the utility has agreed to provide AMI interval data to retailers daily in 15-minute intervals via a web portal. AEP Ohio also agrees to maintain a customer web portal that is customer-focused and displays the customer’s AMI interval usage data.

Costs incurred for the gridSMART Phase 2 project will be recovered through a rider rate filed quarterly, with automatic approval 30 days after the filing. Concurrent with the inclusion of costs, a credit reflecting projected operational cost savings will be incorporated, so that it offsets the costs otherwise recovered through the rider. This initial cost savings credit will flow back $400,000 per quarter, starting in the fourth quarter of the first year.

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