Citizens' Utility Board Pushes For More Protections For Cleveland Residents

A consumer protection group is calling on Cleveland City Council to do more to protect residents from rising utility costs.

The Citizens Utility Board of Ohio (CUB) told council members on Tuesday that Clevelanders are the ones who end up paying, literally, for Cleveland Public Power’s (CPP) bad contracts.

CPP rates are now higher than FirstEnergy’s, said Sandy Buchanan CUB member and executive director at the Institute for Energy, Economics and Financial Analysis. CPP contracts with the American Municipal Power (AMP) group to purchase its power, Buchanan said, and those contracts are costing Cleveland residents far more than they should.

“Our organization estimates that these two contracts alone have cost CPP ratepayers $106 million more for power than customers would have paid if CPP had bought the electricity from regional wholesale markets,” Buchanan said.

CPP’s rates and contracts with APM initially came under scrutiny during a series of hearings on the utility provider’s business practices last year. CPP officials argued in September the rates are higher now because contracts included costs for construction of power plants, but once complete, CPP will own a portion of those plants and then rates are expected to drop below market average.

But council members expressed a desire to revisit those contacts sooner, including Councilman Michael Polensek. The current arrangement with AMP is not living up to what was originally promised, he said.

“I was there when [AMP] came to the table,” Polensek said. “This was going to benefit [Cleveland Electric Illuminating Company], and benefit this, and benefit that. We got hosed, and our ratepayers are feeling it and seeing this in their bills.”

Buchanan and other CUB members urged council members to investigate the contracts to determine why the price of energy through APM contracts are higher and what can be done to bring them down, including potential legal action.

Another possible way to aid residents, Buchanan said, would be to seek out ways to diversify CPP’s portfolio to bring in less expensive energy from renewable sources.

CUB also urged council members to put more local protections in place to prevent dark money in energy campaigns, after a statewide bribery scandal around a nuclear bailout bill last year.

Local legislation can be improved to provide more protection against those kinds of campaigns, said Catherine Turcer a CUB member with Common Cause Ohio, even in mayoral and city council races.

“It’s important to think about robust disclosure as the kind of disclosure you get when you see an ad on television or pick up mail,” Turcer said. “Who’s this from, what’s it about? So far the names of the organizations are vaguely inspirational, they’re always innocuous and reveal very little information.”