Ohio Energy Glossary

Thanks to deregulation in Ohio, many Ohioans get to choose their electric and natural gas supplier. While this can allow you to choose a plan and price that fits best with your home and lifestyle, many terms can be confusing for customers. Below are some terms you might see when you shop for energy or on your bill.

Electricity Distribution

What is an Electric Distribution Company or EDC?

Ohio has four utilities that take care of the transmission and distribution of electricity. While each one does enjoy being the sole electricity distributer in their particular electricity service area, they are required to distribute electricity to every customer in that service area, no matter who the retail electricity supplier is. These utilities are also responsible for providing Standard Service Offers (SSO's) to consumers in their area that do not have, or have not chosen, a retail electricity supplier. All Ohio electricity customers pay an electric distribution cost that is added onto their monthly bill.

The four companies and their local subsidiaries are:

What is a Standard Service Offer?

If you live in Ohio and do not choose an electric supplier, you will receive this service from your EDC.

What is a Competitive Retail Electricity Supplier or CRES?

Customers can choose to buy energy from Certified Retail Electric Suppliers (CRES). These retail electricity suppliers can be any of the following:

  • One of the four electric distribution companies (local utilities).
  • Marketers — Businesses that sell electricity service to individuals and businesses.
  • Brokers or Aggregators — They contract with retailers on behalf of groups of buyers.
  • Government Aggregators —county, municipal, or local community governments that contract with suppliers for service on behalf on their local communities.

Natural Gas Distribution

What is a Local Distribution Company or LDC?

LDCs are responsible for maintaining the reliability and safety of the distribution pipeline system in your area and delivering your gas supply. While Ohio currently has 24 natural gas Local Distribution Companies, customer choice programs exist in areas served by four LDCs. However, these are by far the largest utilities in the state:

What is a Competitive Retail Natural Gas Supplier or CRNGS?

This a person or company that customers can choose to supply or arrange for the supply of Competitive Retail Natural Gas Supply (CRNGS) to their home. Also called "Retail natural gas supplier" or "Retail supplier", they include marketers, brokers, or aggregators, but exclude natural gas companies.

Energy Billing in Ohio

What is a non-recurring fee?

Non-recurring fees are charges that occur only once and are listed separately on your monthly bill. Both your competitive retail electric service (CRES) and your local distribution utility or Electric Distribution Company (EDC) can issue non-recurring fees. CRES non-recurring fees can include recovering devices for promotional offers or early cancellation fees. EDC charges can include switching fees, late payment charges, and reconnection charges following an unpaid bill.

What does kWh mean?

The term "kWh" stands for kilowatt-hour. This is the amount of electricity (in watts) used over time. A 1,000-watt hair dryer running for one hour will use 1 kWh.

What is a CCf or MCf?

The term "CCf" or "MCf" is the unit of measurement for the amount of natural gas consumed in cubic feet; CCF = 100 cubic feet, MCF = 1,000 cubic feet. The amount you pay depends on the amount of CCf (or MCf) /price.

What are distribution charges?

These are the fees that your local utility company charges you to deliver the electricity or gas supply to your location. Your utility company charges these fees no matter which retail company you choose as your electric or natural gas generation supplier. Your monthly bill consists of the cost of the electric generation or gas supply and the cost for distributing that service to your home.

What are transmission charges?

This is the utility's charge for transporting high voltage electricity from the generation plant to the local electric utility. In the case of natural gas, these are the charges to move natural gas through the interstate bulk supply pipelines to your local distribution company (LDC).

About Electricity and Natural Gas Deregulation

What is electricity and natural gas deregulation?

Historically, your community's entire natural gas and electricity supply and delivery came to you exclusively by from one or two local utility companies for your area. The natural gas utilities were called Local Distribution Companies (LDC) while electric utilities were known as Investor-Owned Utilities (IOUs). This monopoly arrangement stagnated development and ballooned prices, which ultimately moved the energy industry across the country towards deregulation in the mid-1990's. Until this time, you were unable to choose a supplier or a pricing plan that fit your needs.

Deregulation broke apart supply, delivery, and sales into separate businesses, creating competition and lowering prices. Today you have the power to choose your own energy service provider. Your local utility company will continue to reliably deliver, maintain, and protect your access to energy while you can shop around for and buy natural gas and electricity at a competitive price from the supplier of your choice.

Direct Energy is proud to be one of your choices for Ohio electric and natural gas! Check out our electricity plans and natural gas plans to get a great rate, reliable customer service, and the tools to track your usage and save money on your Ohio energy bill.


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