OCC Cites Two More Defaulting Gas Marketers

In the fourth time in as many months, the Ohio Consumers' Counsel (OCC) filed two similar complaints with the Public Utilities Commission of Ohio (PUCO) against Summit Natural Gas and The Energy Cooperative --- which includes Cinergy Resources and Licking Rural Electrification --- alleging violations of Ohio's much maligned natural gas choice program, as well as Ohio law.

The complaint against Summit comes after an OCC investigation and unsuccessful attempts to negotiate with the supplier on behalf of its 3,100 residential customers, which it failed to deliver gas to from Dec. 6 through Dec. 12. Columbia Gas terminated Summit from its choice program on Dec. 28.

The petition alleges that Summit served residential customers under one-and-two-year fixed rate contracts, as well as variable rate contracts. The OCC said the company's rates ranged from $3.39/Mcf to $6.64/Mcf.

When Columbia Gas was forced to step in, Summit's customers had to pay Columbia's higher rate. When the switch occurred, Columbia Gas' rate was $0.7375/100 cf, currently, its regulated rate is notched at $0.86478/100 cf.

Robert S. Tongren, of the Consumers' Counsel said, "The OCC remains supportive of the opportunity to choose a natural gas supplier; however, the recent volatility of the market precludes residential consumers from viable options." Tongren said late last month that there currently was no supplier accepting customers at competitive rates.

Similarly, the group's complaint against The Energy Cooperative cites charges of failure to deliver gas and other tariff violations. The OCC alleges that the cooperative mailed letters to 14,000 residential customers informing them their gas supply agreement would be terminated on Oct. 31, 2000, prematurely sending customers back to Cincinnati Gas & Electric's higher market rate.

After negotiations, the cooperative accepted many of its customers back, but refused to reclaim all of them or compensate them for the difference of CG&E's higher market rates. The complaint also accuses The Energy Cooperative of not delivering gas since the first of this year, at which time the company was terminated from CG&E's choice program. At the time of the cooperative's termination, its customers were paying an average fixed contract rate of $3.40/Mcf. CG&E's rate was $7.41/Mcf.

The complaints come as the fourth action since October 2000 that the OCC has taken against suppliers in Ohio's gas choice programs. The OCC lodged a complaint with PUCO last fall against Energy Max for failure to deliver gas to its 8,000 residential customers in August (see NGI, Oct. 30, 2000). The OCC also filed a lawsuit against Columbia Gas choice program participant D&L Gas Marketing for breaching more than 4,500 service contracts in December. Late last month, the OCC requested that PUCO begin an investigation into the current state of the natural gas choice programs in Ohio.

Alex Steis

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