COLUMBUS: Two utility companies will be allowed to eliminate regulated natural gas pricing for businesses in another step toward the deregulation of natural gas in Ohio.
The change only affects businesses, but not household customers, of Columbia Gas of Ohio and Dominion East Ohio Gas with some conditions.
The Public Utilities Commission of Ohio on Wednesday approved the change in a deal reached between independent suppliers, the utilities and the Ohio Consumers’ Counsel.
Businesses will buy from independent suppliers that set whatever price the market bears instead of a price set by a state-supervised competitive auction.
Supporters of deregulation say the actions will lead to greater competition and lower prices. But opponents dispute it, saying that a few dominant suppliers no longer will have to compete with the regulated price.
Todd Snitchler, chairman of the utilities commission, said the change should benefit natural gas customers.
“The transition in Ohio into a more competitive and robust market provides the incentive for suppliers to provide consumers the best options available to them in terms of making a selection for their natural gas needs,” said Todd Snitchler, chairman of the utilities commission.
Dominion East Ohio will be able to end regulated pricing for businesses beginning in April while Columbia Gas of Ohio must wait until April 2014.
Both companies would need to go through a series of regulatory hearings and formally file an application if they want to eliminate the standard price for household customers.
The Ohio Consumers’ Counsel says it would be impossible for Dominion to make that change before 2016 and Columbia wouldn’t be able to do it until 2017 at the earliest.
Raymond Frank, a Columbia Gas spokesman, told The (Cleveland) Plain Dealer that there will be no changes for its business customers unless at least 70 percent of them choose on their own to leave the utility’s standard price.
Frank said about 40 percent of the business and industrial customers have chosen to deal with independent suppliers and about half the residential customers have left for contracts with an independent.
Jeff Murphy, Dominion’s managing director for commercial operations, said the company hasn’t decided whether to try to end the standard offer for residential customers.
He said about 80 percent of business and industry customers, particularly the largest customers, have left the utility’s standard offer for contracts with independent suppliers.