Sam Randazzo Resigns As PUCO Chairman

Today, Sam Randazzo announced his resignation as chairman of the Public Utilities Commission of Ohio.

The Timeline

The announcement follows Monday’s FBI raid of his Columbus home.

It also arrives the day after FirstEnergy Corp. disclosed to the Securities and Exchange Commission an “approximately $4 million (payment) made in early 2019 in to an entity associated with an individual subsequently appointed to a full-time role as an Ohio government official directly involved in regulating the Ohio (energy) companies.” The filing claims the payment was made to terminate a consulting agreement with the individual alluded to, but unnamed, in the filing.

The revelation resulted in the termination of FirstEnergy Corp. CEO, Chuck Jones and two other senior executives. Their dismissal occurred just hours after two associates of former Ohio House Speaker Larry Householder pleaded guilty to charges related to their involvement in a $60 million bribery scheme to pass energy legislation, Ohio House Bill 6.

Leadership Crisis – Randazzo and HB6

Randazzo’s relationship with FirstEnergy Corp. and his testimony in support of passage of HB6 put his commitment to Ohio consumers in doubt. In an interview with the Dayton Daily News, lead energy counsel for the Ohio Environmental Council, Miranda Leppla, stated, “It’s critical that we have independent regulators in our state that are putting the best interest of Ohioans first, not the companies. This filing implies we have at least one regulator whose independence and dedication to protecting the interest of Ohioans is now seriously in question.”

U.S. Attorney David DeVillers described HB6 as a $61 million federal public corruption racketeering conspiracy that is “likely the largest money laundering scheme ever perpetrated against the people of the state of Ohio,” Amid the controversy and alleged corruption, Randazzo’s resignation highlights the need for a legitimate consumer watchdog.

Appointed to the PUCO in 2019, Randazzo led the Ohio organization charged with, “Ensuring financial integrity and service reliability in the Ohio utility industry and monitoring and enforcing compliance with rules and statutory protections against deceptive, unfair, unsafe, and anti-competitive utility practices.” Dissonance between the organization’s stated mission and optics of recent events led to today’s announcement that the PUCO chairman resigned.

Protection for Ratepayers?

While the drama continues to unfold for those connected to HB6, Ohio House Representative Mark Romanchuk (R-Ontario) has championed HB772 which aims to repeal and replace HB6. There’s no timeline for the bill and absent quick action on the bill, Ohio ratepayers will begin to pay for Ohio HB6 January 1, 2021.

That’s the thing about managing energy price risk – if you knew what was going to happen, there wouldn’t be much risk involved, right? You’d know what was going to happen and plan accordingly.

Energy Price Risk Through the Lens of 2020

In a year that’s brought us a global pandemic, global lockdowns and natural gas demand destruction, negative oil prices, murder hornets, record breaking wildfires, and fire tornadoes, if one thing should be clear, it’s that not much is really all that certain. To cope with the uncertainty with a bit of humor the Twittersphere has given us the 2020 bingo card.

As much as sharks with laser beams could prove interesting, I’m okay with not crossing that square off my bingo card. Or any of the remaining squares for that matter. It’s okay for 2020 to close on a quiet note. We’ve earned it.

But I’d not count on it all the same. When the calendar flipped to 2020 and we started off on a new year full of potential, who would have guessed any of the year’s events would have happened? I don’t know anyone that could have foreseen it.

So we were caught off-guard.

Managing Energy Price Risk – An Ounce of Prevention

It may have been impossible to prepare for the specific events 2020 threw at us, but it has highlighted the importance of informed preparation. Proactive planning tends to yield better results than reactively putting out fires. Examining your risk is an essential step in the process.

After two months of near-term natural gas market volatility running from highs to lows, we’re assessing where the market may go next. Watching market fundamentals gives us general insight, but some specifics – like 2020’s events – can’t be predicted.

So it’s important to evaluate how much risk your business can tolerate when it comes to energy market volatility. If you need price certainty, the time to make decisions is now, not in the middle of the proverbial fire.

Managing Risk – Get Help

It helps to have guidance from an advisor you can trust. While you have the big picture that’s necessary for assessing your risk, an informed, trustworthy energy manager can help you make the plans that will help you navigate that risk. If you need help, please give us a call at 1-866-646-7322. 

We’re happy to help.

COVID-19 has created a captive audience ripe for energy phone scams. With consumers at home by the phone and businesses looking for ways to tighten budgets, a new wave of energy fraud is on the rise.

Record Number of Energy Scam Complaints

According to Duke Energy, they logged a record high of 4,000 customer scam complaints in June 2020 and more than 15,000 so far in 2020. The company also noted the scams have evolved, becoming more sophisticated, urging consumers to heightened vigilance.

While not all scams are the same, business and residential energy consumers (electric and/or natural gas) should stay informed and watch for these new tactics:[/vc_column_text]

Energy Phone Scams – You Can’t Always Trust Caller ID

The phone rings, you check caller ID, and it looks like the utility is calling you. Unlike random 800 numbers you might be inclined to ignore, when the utility calls, it’s a slightly different story. Scammers know that, so they use a tactic called spoofing to make it look like they’re calling from the utility. Callers will impersonate utility company employees. They might even go so far as to clone the utility company’s automated menus, making it extremely difficult to distinguish a legitimate call from a fraudulent one.

Many consumers have become wise to such tactics and have taken precautions like refraining from interacting with such calls and instead placing a return call to the utility company.

This preventative measure may be effective, with one caution – make sure the phone number you call back is the one printed on the invoice you receive from your utility company. Don’t call the number the caller provides. Return call numbers also mimic utility company phone numbers, automated greetings, and hold music.

energy phone scams dos and donts list

Anyone saying they are from a power company, but needs your information over the phone, is a scammer.

Energy Phone Scams – Threats and Promises

Until recently, energy scammers focused on manipulating the customer to give their consent to switch energy plans. Callers commonly promised lower rates or rebates, avoided disclosing contract terms, and then left the consumer with a variable rate contract that cost substantially more over time.

However, the economic uncertainty prompted by COVID-19 has spawned two new scams – energy rebate promises and disconnection threats. Be alert if you receive one of these calls.

 

Refund checks – The caller will inform you that you have an overpayment on your account. They state they will mail you a rebate check for the overpayment if you can verify account information. Often they are asking you to provide your birth date, social security number, Federal Tax ID, or other information from your utility invoice. They may claim they need to verify the information for account security.

Generally, utility companies will post overpayments as credits to your account and don’t call customers asking them to disclose secure account information. A report from Strongsville’s Patch states utility companies don’t call consumers and require them to verify personal information over the phone, “Anyone saying they are from a power company, but needs your information over the phone, is a scammer.”

 

Disconnection Threats – Small businesses have been increasingly victimized by this energy phone scam. Callers threaten disconnection if immediate payment isn’t made. In some instances, consumers are prompted to pay by pre-paid debit card (like Green Dot) or a money transfer service (Western Union)

Youngstown’s WFMJ urges consumers to hang up if a caller threatens to disconnect your power service unless immediate payment is made. “Customers who are behind on their accounts receive written notices of a possible disconnection and how to prevent it…representatives often make courtesy calls to explain how a payment can be made using the secure payment options. It is never required to purchase a pre-paid money card as the only acceptable means of payment.”

Robocalls Are Illegal, But Not Going Away

You might be inclined to think the robocall you’re receiving is legitimate because The Telephone Robocall Abuse Criminal Enforcement and Deterrence Act, or TRACED Act makes it illegal to spam call customers. While telemarketing consumers without their written permission and spoofing phone numbers was already illegal, it’s something the FCC rarely enforced.

Even though the new legislation puts the responsibility on telephone companies to stop the calls before they reach consumers, the effort is in progress and has a long way to go. It’s also likely to remain an ever-present threat as industry experts warn scammers will always find a way to reach their targets.

The best prevention? Prioritize mitigation through education and vigilance.

Energy Phone Scams – What To Do When You Get The Call

It’s not a matter of if you get the call so much as when you get it. Here’s what you can do when it happens to you:

  1. Hang up – especially if it’s a robocall. If you want to verify the authenticity of the caller, call the customer service number on your utility invoice.
  2. Never purchase a prepaid debit card or gift card to make an immediate payment to avoid a service disconnection or shutoff. 
  3. Send your payment to the address on the invoice you receive from your utility company. Never use a payment account provided to you by an unknown individual.
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This week Politico reported that Trump administration plans to save aging coal and nuclear plants have stalled in the absence of clearly identified financial backing. Some speculated the cost burden would fall squarely on the shoulders of customers – potentially bearing an annual price tag of $9.7 billion to $17.2 billion.

Energy Secretary Rick Perry argued the price tag is well worth the infrastructure resiliency afforded by coal and nuclear power plants which are capable of storing months of fuel.

All five of the Federal Energy Regulatory Commission (FERC) members countered there is no emergency justification for the bailout and that the unprecedented federal intervention could lead to an unraveling of wholesale power markets.

Sustained by shared opposition from Trump’s advisers on both the National Security Council and the National Economic Council, without significant tolerance for price increases to pay for the plan, it’s possible as the list of coal and nuclear plants under bankruptcy grows, Trump is quietly walking back his support for coal’s Hail Mary – at least for now.

The Harvard Study

A 2019 Harvard University study indicates wind power provides long-term advantages over natural gas and coal. However, wind may not be as clean as previously thought. The study showed that large wind deployments require more land than accounted for by initial studies. Research also revealed early findings failed to identify turbine-caused temperature increases. As wind energy advances, it will become increasingly important to examine such impacts.

Wind Power Deployments on the Rise

According to a recent EIA report, “Total renewable energy consumption in the United States grew for the fourth year in a row. Since 2015, the growth in U.S. renewable energy is almost entirely attributable to the use of wind and solar in the electric power sector. In 2019, electricity generation from wind surpassed hydro for the first time.”

To that end, in 2019, natural gas (38%) edged out coal (23%) as the largest source of power generation. Renewables (17%) ranked 4th, just behind nuclear (20%). Of the renewable contribution, 42% came from wind power, 38% from hydroelectric, and just 2% from solar. 

So while wind has already outpaced solar as America’s go-to renewable, solar’s environmental impact may be substantially less than wind power. However, wind has the advantage when it comes to space. According to one study, “one wind turbine generated the same amount of electricity per kWh as about 48,704 solar panels.”

Future Planning

The study’s authors warn that this information should not be taken as a case against wind energy. “Rather, the work should be seen as a first step in getting more serious about assessing these impacts for all renewables.”

Read the Harvard study, “Observation-based solar and wind power capacity factors and power densities.” here

Suggests Price Instability Is The Larger Threat

All five members of FERC, the regulatory group responsible for the U.S. power grid, stated there is nothing to suggest an forthcoming emergency in the country’s electricity markets. Their testimony before Tuesday’s Senate hearing could undermine the Trump administration’s efforts to save ailing coal and nuclear plants through subsidies. Many of the plants have closed or signaled closure in the face of plentiful natural gas, growth in wind and solar power, and stagnant power demand.

Source: Reuters, U.S. electricity commission sees no emergency in power market


Learn more about controlling your energy costs through managing your load or contact us for a tailored energy savings analysis.

Study Shows Ohioans Oppose Regulated Energy Market

Ohio voters oppose a regulated energy market, according to a Fallon Research poll. Throughout 2016, the largest electric utilities in Ohio discussed restructuring competitive markets within the state. Despite the utility giants’ efforts to change the established seven-year construct, Ohio voters may be the biggest political snag in their way.

Fallon Research and Communications conducted the telephone poll in January. First reported by The Cleveland Plain Dealer, it revealed Ohio voters were uniformly opposed to a regulated market construct that would make way for monopoly utilities. The survey polled a panel of 800 Ohio voters about key supporting issues. The results favoring energy choice and objection to monopoly utilities were consistent across party affiliation, gender, age, and location.


Results from Fallon Research’s Poll & The Plain Dealer’s Report:

Evidence of Opposition to Regulated Energy

More than 91 percent opposed any law change allowing FirstEnergy or AEP to build new power plants and raise monthly rates to pay for them. AEP wants to do exactly that, build wind and solar farms and maybe new gas turbine plants while selling off or closing its old coal units.

Nearly 79 percent opposed legislation that would eliminate a customer’s choice to shop for power suppliers. Suppliers now compete for customers through a state-maintained “Energy Choice” website. A return to old-style regulation would end competition. Regulation would force customers to return to their traditional electric utilities.

Nearly 62 percent of people polled said they would oppose paying extra every month to support older power plants that cannot compete well against modern gas turbine plants. FirstEnergy has persuaded state regulators to do just that. Federal regulators previously objected to more expensive proposals that spelled out exactly how the extra fees would be spent.

Nearly 60 percent of voters objected to the creation of special subsidies for one fuel source. FirstEnergy’s nuclear power plants are one example. They are expensive to operate and don’t compete well against gas turbine plants. The idea has been adopted in New York and Illinois, but has been challenged as anti-competitive.

AARP and the Alliance for Energy Choice funded the statewide poll. The Alliance spokesperson, and former chairman of the PUCO, Todd Snitchler spoke on the results of the poll commenting that, “The results of the poll clearly demonstrate that talk about a need for re-regulation or changes to Ohio’s energy landscape, is pointed in the wrong direction.