Ohio weighs tighter controls as questions grow over $10 billion in utility spending

Ohio seeks more transmission oversight

The Office of the Ohio Consumers’ Counsel seeks federal review of billions in supplemental transmission projects as residential customers face rising electric bills and questions about utility spending continue.

The agency argues that Ohio consumers should not fund large transmission investments without meaningful review of project need, cost-effectiveness, alternatives, and other protections before charges reach bills.

Transmission spending keeps rising

Ohio Consumers’ Counsel says supplemental transmission spending covered by its federal complaint has continued rising since the 2023 filing as additional local projects have moved forward during the unresolved proceeding.

The growth reflects more projects entering the system while the complaint remains unresolved, expanding the amount of transmission spending that consumer advocates want federal regulators to examine closely.

The 2023 complaint remains pending

Ohio Consumers’ Counsel filed its complaint with the Federal Energy Regulatory Commission in September 2023, challenging oversight of supplemental projects planned by several major Ohio transmission utilities operating there.

Federal records still list the complaint as pending, leaving the central dispute unresolved nearly three years after the consumer advocate first asked regulators for stronger project review protections.

Supplemental projects follow different rules

Supplemental transmission projects are proposed by individual transmission owners for local needs and are not required by PJM Interconnection for regional reliability, economic efficiency, or operational performance criteria.

PJM includes these projects in regional planning models, but transmission owners identify the underlying need rather than PJM independently determining that each project is necessary for the region.

PJM evaluates regional system effects

PJM Interconnection evaluates supplemental projects for their effects on the regional transmission system before those local investments are incorporated into broader planning models used across the wider network.

That review does not determine whether a project represents the least costly solution, whether another option would work, or whether the local investment itself is economically justified independently.

State regulators have limited review

Ohio regulators do not independently determine whether every supplemental transmission project is needed or whether lower-cost alternatives should replace utility proposals before construction moves forward in practice.

That gap leaves key questions about project necessity and alternatives outside the usual state regulatory process, while transmission costs can still flow through rates paid by Ohio customers.

Competitive bidding is not required

Many supplemental transmission projects do not go through competitive bidding, allowing incumbent transmission owners to select how local infrastructure is developed without comparing rival construction proposals for each project.

Consumer advocates argue that broader competition could provide useful cost comparisons, while utilities retain responsibility for planning local facilities needed to serve their systems and meet operational requirements.

Utilities can earn on construction

Transmission owners generally recover approved investment costs through regulated rates and can earn authorized returns on capital placed into service, creating earnings tied to infrastructure construction spending levels.

That regulatory structure does not prove any project is unnecessary, but it gives consumer advocates another reason to seek independent review before customers finance large supplemental investments through rates.

Data centers are adding new demand

Large data centers have become a driver of electricity demand in Ohio, increasing pressure for transmission upgrades where existing local infrastructure cannot serve requested loads without additional work.

Ohio Consumers’ Counsel has linked part of the recent growth in supplemental projects to large data center connections, while urging stronger protections against shifting private infrastructure costs to households.

Ohio proposed $1.9 billion in 2024

Ohio utilities proposed about $1.9 billion in supplemental transmission projects during 2024, with roughly $1.3 billion appearing connected to upgrades associated with growing data center electricity demand.

Those figures illustrate the scale of local transmission spending associated with new large loads, adding another layer to the broader dispute over oversight and customer cost responsibility in Ohio.

Four major utility groups are involved

The 2023 federal complaint names transmission owners affiliated with American Electric Power, AES Ohio, Duke Energy Ohio, and FirstEnergy among companies whose supplemental project practices face federal scrutiny.

Ohio Consumers’ Counsel is challenging the regulatory framework applied to those projects rather than claiming every investment is unnecessary, keeping the dispute focused on review, transparency, and consumer protections.

Little-known fact: Utilities plan $1.4 trillion in grid investments by 2030, a sharp rise from last year’s forecasts.

The consumer advocate seeks faster action

Ohio Consumers’ Counsel continues actively seeking faster resolution of its pending complaint before the Federal Energy Regulatory Commission as the dispute over supplemental transmission oversight remains formally unresolved.

The request reflects concern that additional projects continue entering the pipeline while federal action remains pending, leaving the disputed oversight structure unchanged as transmission spending keeps expanding in Ohio.

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The dispute centers on who reviews costs

The unresolved case focuses on whether supplemental transmission investments receive enough independent scrutiny before their costs are recovered from customers through federally regulated transmission rates across Ohio communities.

A federal decision could shape how future local transmission projects are reviewed, but the complaint remains pending, so any stronger oversight requirements or procedural changes are not final.

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What do you think about Ohio weighing tighter controls over $10 billion in utility spending? Share your thoughts in the comments.

This slideshow was made with AI assistance and human editing.

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