Duke Energy 2006 Annual Report Download - page 20

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Balancing regulated and non-regulated assets
When electric generation was deregulated in Ohio in 2001, many people expected a fully competitive market to develop in
the first five years. But that didn’t happen. As the end of that five-year period drew near, regulators, utilities and customers
realized that an immediate shift to market-based rates in 2006 would probably result in large price increases over a short
time, as had occurred in other states. To minimize rate shock and to permit a gradual transition to market-based rates, state
regulators worked with Ohio’s electric utilities, including Duke Energy Ohio, to develop rate stabilization plans (RSPs). These
plans provide customers with stable, predictable rates for a number of years — in Duke Energy’s case, from 2006 through
2008. In late 2006, Duke Energy Ohio asked regulators to extend its RSP by an additional two years, through 2010. Under
the proposed extension, which is being reviewed, the utility’s unregulated generating assets in Ohio would continue to serve
the state’s retail customers. The plan supports continued electric system reliability and sends clear price signals to customers,
while helping to maintain a stable revenue stream for the company.
DAVE CELONA, VICE PRESIDENT FOR GOVERNMENT AND REGULATORY AFFAIRS
AT DUKE ENERGY OHIO, IS WORKING TO PROVIDE STABILITY TO OHIO’S ELECTRIC INDUSTRY BY PROMOTING
THE EXTENSION OF THE COMPANY’S RATE STABILIZATION PLAN.
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