September 18, 2025
Energy Costs: Rising Prices, the AEP Rate Case, and Demand Response
Electric bills skyrocketed this summer, and rates are likely to increase even more. Your electric bill has three parts, like a three-legged stool: generation (the cost of making the electricity), transmission (the cost of sending large amounts of electricity from the big power plants to your area), and distribution (the cost of sending the electricity into your home). Poor planning from regulators and policies stifling renewable energy generation caused the stool to go off balance and your electric bill to skyrocket. Now, utilities in Ohio are asking for rate hikes, which will only throw this stool further off balance.
Ohio legislators and regulators made the generation leg of the stool shrink by slowing down renewable energy generation. State laws like SB 52, which let counties ban renewable energy, slowed solar energy development in Ohio. Regulators have also slowed the process for renewable energy to come online. At the same time, high costs and supply chain constraints on natural gas turbines are slowing the construction of new natural gas plants. So, while hotter summers and new industries like data centers have also increased demand, and regulators slowed the process for new energy to meet that demand, the generation leg of the stool shrank.
The transmission leg of the stool was not prepared for the generation leg to shrink and had to overcompensate by raising prices. Instead of fixing these issues, the transmission operators tried to blame the generation leg of the stool. With no fixes, prices are climbing again.
Now, distribution utilities like AEP Ohio and FirstEnergy want to increase prices on the distribution leg too.
The OEC is taking action to rebalance this stool and make your energy bill affordable, while decarbonizing our grid. Will you join us? You can visit the energy page to sign up for alerts and check our latest blog posts.
The OEC is actively working to restore stability and reduce emissions in the grid. Will you take part in this effort?
