Duke Energy urges reforms on Ohio's Senate Bill 2 to boost economic development

The Ohio Senate Energy Committee convened on February 25, 2025, to discuss Senate Bill 2, a significant piece of legislation aimed at modernizing the state's electric utility regulations. The meeting featured testimony from representatives of Duke Energy Ohio, who expressed both support and concerns regarding the bill's provisions.

The committee began by reviewing the overall impact of Senate Bill 2 on utility operations and customer relations. Duke Energy representatives highlighted that while the bill introduces some improvements, it ultimately falls short of fully modernizing regulations. They emphasized that certain policy components could hinder the ability of utilities to meet customer needs and expectations, potentially leading to increased costs for consumers.

One of the key points raised was the bill's proposal to eliminate Electric Security Plans (ESPs), which have historically allowed utilities to recover certain investments between base rate cases. The removal of ESPs could exacerbate regulatory lag, a situation where there is a delay between investment and cost recovery. Duke Energy noted that Ohio currently ranks last among states in terms of regulatory lag, which could stifle investment and economic growth.

The representatives also discussed the implications of requiring all utility charges to be subject to refunds if deemed unreasonable. They argued that this could create financial uncertainty for utilities, ultimately leading to higher rates for customers. Additionally, the bill's provisions regarding the certification process for utility projects were scrutinized, particularly the requirement for like-for-like replacements to undergo the same certification as new projects.

Another significant concern was the proposed customer choice billing system, which could complicate billing processes for customers receiving services from multiple suppliers. Duke Energy urged the committee to reconsider this aspect to avoid further confusion for consumers.

The discussion also touched on the need for a more balanced tax policy for existing electric generation resources, as the current framework is seen as uncompetitive compared to neighboring states. Duke Energy called for parity in tax treatment between new and existing generators to foster a more favorable economic environment.

In conclusion, the committee acknowledged the importance of the discussions and the need for ongoing dialogue to address the concerns raised. Duke Energy expressed a willingness to collaborate on amendments to Senate Bill 2, aiming to create a regulatory framework that supports economic development while ensuring reliable utility services for Ohio residents. The meeting concluded with an invitation for further feedback as the bill progresses through the legislative process.