Frontier Power

Change and Frontier Power

Deregulation continues to be in the forefront of our news in Ohio. In 2000, the Ohio Legislature passed a new law to allow competition in the electric industry as of January 1, 2001. When drafting this new law for competition, the Ohio Legislature recognized that Rural Electric Cooperatives are different and special. We are self-governed, member-owned, service oriented cooperatives looking out for our member’s best interests. Consequently, the Ohio electric cooperatives have been given the choice of “opting in” to customer choice or “opting out”.

What does this mean to our members? Opting in means you would be able to shop around for the electricity that we deliver to your home or business from any qualified marketer. But keep in mind that the generation cost of the electricity you use is only about 50 percent of your electric bill each month. How much you would be able to save on this portion of your bill remains to be seen.

Opting out means Frontier Power customers will continue to receive all their power needs from our Cooperative owned power supplier, Buckeye Power, Inc. It also means no other power company may sell power to our customers. In other words, we would continue as we have in the past.

In the next few years one thing is certain, the electric utility industry in Ohio will be in a state of change. In anticipation of deregulation, we had an engineering firm perform a cost of service and rate study a few years ago for the Frontier Power Company. The last such evaluation was performed in 1982 with the last rate increase in 1984. The study showed an adjustment of our rates is needed, but we have decided not to make any changes in rates until more is understood about deregulation. The only change that has been made was in the calculation of the wholesale power adjustment from 3.6 cents to 3.5 cents per kilowatt to more closely reflect our cost of power.

A decision to “opt-in” to customer choice is irrevocable for Ohio coops. It’s a decision we have been examining very closely to determine the best interest of our members. The costs for Frontier Power Company, Buckeye Power Inc. and all of the Ohio Coops to comply with all of the regulations of customer choice appear to be very high. We believe opting-in will actually increase the cost for our customers. For now the Frontier Power Board of Directors have decided to learn from the mistakes other utilities will make in the deregulated electric market and opt-in when the time is right for our members.

As always, we are trying to develop the most cost-effective strategy to deliver the best service possible. We will continue to keep you informed through articles in Country Living Magazine, member information meetings and our annual meetings in July. If you have any questions, please email us at fpc@frontier-power.com.

The Frontier Power Company, 770 South 2nd Street, Coshocton, OH 43812

740-622-6755 800-624-8050 fpc@frontier-power.com