Ohio allows utilities to fund many discrete activities such as smart grid development or distribution pipe replacements through riders. A rider is an add-on to the distribution rates. It is generally not broken out. Riders are adjusted quarterly, semi-annually, or annually.

In 2021, the Universal Service Fund (USF) Rider will be set to collect $192 million. There was an over-recovery of $94 million last year, so the program is projected to cost $286 million in the coming year. Level funding is provided for EPP at $14 million. Approximately 240,000 households benefit from the program, the lowest level in the past decade. Many observers expect the number of participants to increase because of job loss associated with the COVID-19 pandemic.

The Universal Service Fund Rider, which provides the resources for electric PIPP+ and the Electric Partnership Program, is set annually through a two-phase proceeding. The first phase litigates policy issues associated with the rate. The only issue that has been litigated in the past ten years is the use of a two-step rate, with large industrials paying a lower rate for energy used in excess of 833,000 kWh/month. (The typical home uses around 1,000 kWh/month.)

OPAE has twice raised the argument that charging large industrials a lower rate is discriminatory under the statute, which requires a single rate, but has never succeeded in convincing the PUCO. The instigator of the two-step rate, and its primary protector, has been the Industrial Energy Users – Ohio, which until recently was headed by Sam Randazzo, the now ex-chair of the PUCO.

We may have to try again next year.

Ohio is fortunate in that all customers pay for PIPP+, both gas and electric. This is not the case in many other states with a PIPP. The tendency is for residential customers to pay for the program.