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As Introduced
136th
General Assembly
Regular
Session
H. B. No. 427
2025-2026
Representative Klopfenstein
To
amend section 4909.192 and to enact section 4928.106 of the Revised
Code
to
authorize voluntary demand response programs for residential and
small commercial customers.
BE
IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section
1.
That
section 4909.192 be amended and section 4928.106 of the Revised Code
be enacted to read as follows:
Sec.
4909.192.
When
considering an application to increase rates under section 4909.18 of
the Revised Code, the public utilities commission may approve the
following:
(A)
Nondiscriminatory programs available for all energy-intensive
customers to implement economic development, job growth, job
retention, or interruptible rates that enhance distribution and
transmission grid reliability and promote economic development.
(B)
Nondiscriminatory programs available for all mercantile customers, as
defined in section 4928.01 of the Revised Code, that align retail
rate recovery with how transmission costs are incurred by or charged
to the electric distribution utility, as defined in section 4928.01
of the Revised Code, or programs that allow customers to be billed
directly for transmission service by a competitive retail electric
service provider.
(C)
Nondiscriminatory programs available for residential customers and
small commercial customers, as defined in section 4928.101 of the
Revised Code, that reduce demand at peak times for purposes of grid
reliability or to help lower customer rates, including peak demand
reduction programs under section 4928.106 of the Revised Code. Any
programs to reduce demand proposed in an application to increase
rates shall include terms permitting competitive retail electric
service providers, certified under section 4928.08 of the Revised
Code, to offer their customers access to these programs.
Sec.
4928.106.
(A)
As used in this section, "small commercial customer" has
the same meaning as in section 4928.101 of the Revised Code.
(B)
An electric distribution utility may create a voluntary demand
response program to lower demand at peak times for residential
customers and small commercial customers as described by this
section.
(C)(1)
Each demand response program under this section shall be evaluated by
the public utilities commission to determine if the program is
cost-effective for customers. To determine if the program is
cost-effective for customers, the commission shall consider all of
the following:
(a)
The need for demand reduction based on capacity prices;
(b)
The long-term savings to the grid;
(c)
Any other factors that the commission deems appropriate.
(2)
No electric distribution utility shall offer a demand reduction
program under this section unless the program is approved by the
commission.
(D)
An electric distribution utility may enter into an agreement with a
residential customer or small commercial customer for the customer to
participate in the utility's demand response program.
(E)
For customers that participate in the program, the utility may take
actions to reduce the customer's load at peak times, such as
increasing the temperature on the customer's air conditioner,
reducing the temperature on the customer's hot water heater, or
cycling other appliances.
(F)
A customer that participates in the program may override the
utility's action to reduce the customer's load for any individual
event.
(G)
A utility may set rules that restrict a customer's future
participation in the utility's demand response program if the
customer overrides the utility's action pursuant to division (F) of
this section.
(H)
A customer that agrees to participate in the utility's demand
response program shall be paid by the utility a fee on an annual or
per event basis approved by the commission.
(I)
A utility or competitive retail electric service provider may bid the
demand response reductions from the utility's demand response program
into the capacity market of the regional transmission organization
approved by the federal energy regulatory commission and having the
responsibility for maintaining reliability in all or part of this
state.
(J)
A utility that bids demand response reductions into the capacity
market shall use revenue earned from the bidding to offset costs of
the utility's demand reduction program.
(K)
The commission may approve a performance incentive for a utility with
a voluntary demand response program based on savings the program
generates.
(L)
Not more than three years after the effective date of this section,
the commission shall evaluate the success of the utility demand
response programs and make recommendations to the legislature
regarding bidding demand response into the capacity market under
division (I) of this section and any other modifications to the
programs that will enhance customer benefits.
Section
2.
That
existing section 4909.192 of the Revised Code is hereby repealed.