Ohio commercial electricity: SSO and choice

The four investor-owned utilities, and what “Ohio rates” hides

Ohio has no single commercial electricity market. Distribution is run by investor-owned utilities under PUCO tariffs, and there are four groups of them: AEP Ohio; the three FirstEnergy operating companies — Ohio Edison, The Illuminating Company and Toledo Edison; Duke Energy Ohio; and AES Ohio, the former Dayton Power & Light. Each files its own delivery tariff, each has its own rate classes, and each publishes its own Price to Compare for supply. That means a rate a business reads for “Ohio” is almost always a rate for one utility and one class, and applying it to a site in a different territory is the most common way an Ohio comparison goes wrong before it starts. Municipal electric systems and rural cooperatives sit outside the investor-owned map altogether and set their own terms, so the first question is not what the rate is but which utility delivers the address.

• The four investor-owned groups are AEP Ohio, FirstEnergy, Duke Energy Ohio and AES Ohio.
• FirstEnergy delivers through Ohio Edison, The Illuminating Company and Toledo Edison.
• Each utility files its own delivery tariff and rate classes.
• Each utility publishes its own Price to Compare for supply.
• Municipal systems and rural cooperatives sit outside the investor-owned map.

The Standard Service Offer is a procurement result, not a posted rate

A customer who never shops stays on the utility's Standard Service Offer, which Ohio law requires each distribution utility to provide as a comparable default supply. The SSO is not a number the utility chooses. It is approved by PUCO as part of an Electric Security Plan, which packages competitive procurement with utility-specific riders and cost-recovery terms, or as a Market Rate Offer built from competitive procurement alone. In practice the Ohio utilities buy their default supply through PUCO-approved auctions in which suppliers bid to serve the utility's full-requirements load, including energy and capacity, and the results are blended across several procurement events rather than struck at a single price. The consequence for a buyer is that the SSO moves on a procurement calendar that has nothing to do with the customer's own usage, and that a supplier bidding against it is bidding against a portfolio of auction tranches, not a spot price.

• The Standard Service Offer is the default generation service.
• Ohio law requires each utility to provide a comparable default supply.
• The SSO sits inside an Electric Security Plan or a Market Rate Offer.
• Default supply is procured at PUCO-approved competitive auctions.
• Auction results are blended across several procurement events.

The Price to Compare, and the chart Ohio publishes itself

Ohio gives a buyer two instruments that most states do not. The first is the Price to Compare, the utility's per-kilowatt-hour generation benchmark — the supply price a customer avoids by switching, and it excludes distribution, transmission riders and everything else on the delivery side. The second is the Apples-to-Apples chart, run through PUCO's Energy Choice Ohio portal, which standardises certified supplier offers so they can be read side by side: supplier, generation price, whether it is fixed or variable, contract term, any introductory price, early-termination fees, recurring monthly fees, renewable content, and the utility's current Price to Compare for the class. The chart is the closest thing Ohio offers to a statewide comparison, and it is still not a bill estimate: delivery stays with the utility, and a commercial user has to confirm the listed offer is actually open to its rate class and usage before treating the rows as comparable.

• The Price to Compare is a generation benchmark and excludes delivery.
• It is the supply price a customer avoids by switching.
• The Apples-to-Apples chart is PUCO's standardised offer comparison.
• It lists price shape, term, fees and renewable content per offer.
• Confirm an offer is open to your commercial rate class before comparing.

Governmental aggregation: opt-out for small accounts, consent for the rest

Ohio permits a municipality, county or township to aggregate retail load under ORC 4928.20, and the state draws a line through it that matters to a business. Automatic, opt-out enrolment is allowed only for customers who are not mercantile customers. A mercantile customer may be aggregated only with prior, affirmative consent, so a business above the line cannot be swept into an opt-out programme by default. The definition is statutory, not intuitive: under ORC 4928.01, a mercantile customer is a commercial or industrial customer using electricity for non-residential purposes who either consumes more than 700,000 kilowatt-hours a year or is part of a national account with facilities in one or more states. PUCO certifies aggregators and programmes under OAC Chapter 4901:1-21, where a programme term runs from one to three years and a non-consenting mercantile customer is expressly ineligible to be enrolled. Opt-out customers must be given an opportunity to opt out at least once every three years.

• Governmental aggregation is authorised by ORC 4928.20.
• Only non-mercantile customers can be enrolled on an opt-out basis.
• Mercantile customers require prior, affirmative consent.
• The mercantile line is 700,000 kWh a year or a multi-state national account.
• PUCO certifies aggregators and programmes under OAC Chapter 4901:1-21.
• Programme terms run one to three years.

Delivery classes sit on a voltage ladder and a billing-demand floor

Ohio delivery tariffs classify a site by the voltage at which it takes service, and the larger classes bill a demand charge on top of energy. The FirstEnergy Ohio schedules make the ladder explicit: Rate GS for general service at secondary voltage, Rate GP at primary voltage, Rate GSU at subtransmission and Rate GT at transmission, with the customer's class following the service it takes. The same tariff shows how billing demand is built. On the Toledo Edison schedule the billing demand for the month is the greatest of the measured demand — the highest fifteen-minute integrated demand — a stated floor of 5 kW on Rate GS and 30 kW on Rate GP, and the contract demand, so a small site with a light month still bills at the floor. AEP Ohio, Duke Energy Ohio and AES Ohio each publish their own schedules with their own thresholds, and smaller general-service accounts are billed largely on energy while the medium and larger classes carry a demand charge. A supply switch does not move a site between classes.

• FirstEnergy's Ohio ladder runs GS, GP, GSU and GT by service voltage.
• Billing demand is the greatest of measured, floored or contract demand.
• Toledo Edison floors Rate GS at 5 kW and Rate GP at 30 kW.
• Measured demand is the highest fifteen-minute integrated kW.
• Smaller classes bill mainly on kWh; larger classes carry a demand charge.
• A supply switch does not change the delivery class.

The ratchet, and why a quiet month is not a cheap month

Ohio demand charges price the peak, not the volume, and the tariffs add provisions that carry a past peak forward. The billing-demand floors are the simplest of them: a class minimum means the charge never falls to zero even in an idle month. The more consequential mechanism is a ratchet, and Ohio's larger schedules illustrate it. The FirstEnergy tariff refers to a “monthly base period demand” — the billing demand established in the same month of the preceding year — and uses it in curtailment provisions, so a prior year's peak is a live number on the account. A common structure across US commercial tariffs, described in the Department of Energy's business-billing guide, floors billing demand at a share of the highest summer demand and applies it for the following months; that pattern is tariff-specific and not universal to Ohio, but it is the reason a reduction in kWh does not always reduce the delivery charge, and the reason a demand charge has to be read against the metered interval rather than the monthly total.

• Demand charges price the peak, not monthly volume.
• Class floors keep the charge above zero even in a light month.
• FirstEnergy references a monthly base period demand from the prior year.
• A seasonal ratchet can floor billing demand at a share of the summer peak.
• Ratchet terms are tariff-specific, so read the schedule in force.
• Reducing kWh does not by itself reduce a demand charge.

Capacity lands in the supply price, and Ohio's zones differ

Ohio load is not one PJM capacity zone. It is split across three: ATSI, spanning much of northern Ohio and a large part of FirstEnergy's territory; AEP, covering AEP Ohio's load area; and DEOK, covering Duke Energy Ohio in the southwest and adjacent northern Kentucky. The zone matters because PJM capacity can price differently where transmission constraints separate a zone from the rest of the system, and because the obligation is attached to the load-serving entity and zone rather than to the state. Capacity is a supply-side cost, so it reaches a customer inside the supply line rather than as a delivery charge: a fixed offer embeds an assumption about future capacity, and a pass-through offer prices it separately against the customer's capacity tag. Two Ohio sites with similar consumption can therefore carry different capacity cost inside an otherwise similar supply price, which is why a statewide blanket quote is a weaker instrument than one built per utility and zone.

• Ohio load sits in three PJM capacity zones: ATSI, AEP and DEOK.
• ATSI covers much of northern Ohio; DEOK covers southwest Ohio.
• Capacity prices can differ by zone when transmission constrains.
• Capacity is a supply-side cost, not a delivery charge.
• A fixed offer embeds a capacity assumption; a pass-through prices it separately.

What to establish before comparing an Ohio offer

The Ohio questions are about identity before they are about price. Confirm which utility and, for FirstEnergy, which operating company delivers the site. Establish the rate class and whether the account is on a demand-rated schedule, then pull the Price to Compare at that class and the relevant period rather than against a general Ohio figure. Establish whether the offering is fixed, variable or indexed, and what the Apples-to-Apples row says about term, introductory pricing, early-termination fees and recurring monthly fees. Check whether a governmental aggregation programme reaches the account — and if the load is mercantile, confirm it was enrolled by affirmative consent, because it cannot be swept in by default. Finally, note the PJM zone, because it decides how capacity is priced inside whatever offer is put in front of you. Competitive supply depends on the service address, the meter and the utility territory, and not every address has a choice. An inquiry places no order and switches no supplier, and HighGround may receive compensation from providers on completed purchases.

• Identify the utility and, for FirstEnergy, the operating company.
• Establish the rate class and whether it is demand-rated.
• Use the Price to Compare for that utility, class and period.
• Read term, fees and price shape off the offer, not the headline.
• Confirm whether aggregation reaches the account and on what consent basis.
• Note the PJM zone, which sets how capacity is priced.
• An inquiry places no order and switches no supplier.

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