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Not watt businesses want

Melissa Topey • Apr 20, 2014 at 3:20 PM

A non- organization dedicated to helping small business is projecting electric rates to skyrocket over the next couple years.

FirstEnergy acknowledged Friday increases are on the way but offered no predictions on how big rate hikes will be.

The Council of Smaller Enterprise is predicting a steep increase of 35 percent in electric rates over the next three years. The increases will come as a result of FirstEnergy closing its coal plants and converting to natural gas plants, said Randy Carpenter, spokesman for the agency.

And the demand for electricity is projected to only increase, creating other pressures pushing higher costs, he said.

There will be an increase in Northeast Ohio, said Diane Francis, First Energy spokeswoman. But what that increase will be is dependent on a lot of factors, especially the PJM Interconnection, Francis said. There is no way to know what percent the increase will be, she said.

PJM Interconnection is a powerful network that coordinates the movement of electricity to the market in 13 states, including Ohio, and ensures the regional grid has enough electricity to power the needs of its consumers. It is this capacity charge that the Council of Smaller Enterprises contends will be responsible for the upcoming spike in electric prices.

Representatives from the Public Utilities Commission of Ohio, a state agency that regulates utilities such as FirstEnergy and others, did not return phone calls Friday.

Meanwhile, the Erie County Chamber of Commerce is helping its business members get the cheapest electricity rates possible.

Chamber members can apply to be part of a co-op — the Council of Smaller Enterprises, known as COSE — a large nonprofit organization made of thousands of businesses that support small businesses by offering group rates on health insurance that might otherwise not be able available to the businesses.

COSE has a lot of influence to advocate for small business, said John Moldovan, president of Erie County Chamber of Commerce.

The group will negotiate with FirstEnergy for the best electric rates possible and lock them in for three years, Carpenter said.

Businesses are especially affected by increases to electricity rates because they are, on average, larger than a residential home, have more open space and operate longer hours each day. The impact increased electric rates could have on member businesses is a concern for local chambers, Moldovan said.

“Like with health insurance we offer, we want to help our members get the best (electric) rates possible” Moldovan said.

Any small business that is a chamber member can go to cose.org/electric for information.

How to read your electric bill

•The transmission cost:

What you pay to have electricity delivered to your home or business. This is a fixed rate based on use.

•The generation cost:

What you pay for the electricity you actually use. This is a line item that can be negotiated by shopping around for the best rate.

•The capacity charge:

What pays for the operation of the PJM. PJM ensures the regional grid has enough electricity to power the needs of its consumers. It is this capacity charge the Council of Smaller Enterprises will be responsible for with the upcoming spike in electric prices.

Source: Council of Smaller Enterprises

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