OH Sees 9-18% Summer Power Reserve 'Cushion'

With system reliability and power reserve margins becoming catch-phrases nationally going into summer's hottest months, the Ohio Consumers' Counsel (OCC) has gone on the record to allay consumers' fears, saying it is "reasonably optimistic" the state's electric system can meet power demand this summer.

As the advocate for Ohio's residential utility customers, the OCC said in its June Ohio Consumers' Corner newsletter that it recently met with representatives of the state's four major investor-owned electric utilities to review their ability to generate electricity to meet projected heat-driven consumer demand. It also discussed the utilities' contingency plans for dealing with other factors that could impact the marketplace.

The OCC reported that as long as the state does not experience abnormally hot and humid weather with temperatures rising above 95 degrees for an extended period of time, or unexpected power plant shutdowns, Ohio should have enough electricity to meet this summer's demand for electricity.

During the OCC's meetings, it found that American Electric Power, Cinergy, Dayton Power and Light, and FirstEnergy all project they will have access to a reserve margin of about 9-18% once summer really heats up. These estimates are consistent with the findings of the East Central Area Reliability (ECAR) Council, which projects a regional "cushion" of about 11.5% during the peak-demand summer months, the OCC said.

The OCC said the state's utilities also have contingency plans if other factors, such as shutdowns affect supply. Utilities may purchase power from out-of-state suppliers or, in times of extremely tight supply, interrupt the service to some of their large industrial customers to ensure that residential customers continue to receive electricity.

"With normal summer weather and no unexpected power plant outages, we should have all the electricity we need to get through the summer safely and in comfort," said Robert S. Tongren of the OCC. "We're fortunate that here in Ohio a number of new gas-fired power plants are expected to be ready for use during peak usage times this summer." Tongren said the new peaking plants can produce about 1,430 MW, which is enough electricity to power about 950,000 households.

While the OCC's forecast predicts that Ohioans will be safe from power woes this summer, other states and regions of the country are not likely to be as lucky. With the weather just starting to heat up, the OCC pointed out that consumers in California are already paying 10-to-20 times as much to buy power as they did just a year ago.

However, there is no need for alarm in Ohio, Tongren said, because for the next three to five years, Ohio's residential consumers are protected from those kinds of potential price spikes. Provisions in Ohio's electric choice law that took effect on Jan. 1 reduced the rate of the generation component of residential consumers' electric bills by 5%, which should result in a 2-3% reduction in a consumer's total electric bill, the OCC said.

Although the state appears to be safe this summer, the Counsel said it still advises consumers to do their part. The OCC said conservation efforts by consumers can ensure that demand does not exceed supply in Ohio this summer.

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