Residential Fixed Rate Increases

How can you tell if your fixed rate is going to increase?

You might have seen the recent news articles announcing that three of Ohio’s major utility companies, namely AEP, Duke, and FirstEnergy, are “decoupling” their residential rate structures. In essence, the change amounts to an increase in fixed charges along with a parallel decrease in distribution rates.

(For a better understanding of how these two charges combine to form your energy bill, check out our blog post on understanding your utility bill.)

While many fear that this will automatically mean higher energy bills, this is not necessarily the case. Though the increases for all three companies’ fixed distribution rates are higher than the decreases to the usage-based rates, a “breakeven point” of usage exists for customers at which the annual costs at the new rate will be virtually equal to the old rate.

Here are the approximate monthly breakeven points for customers of each company:

AEP Ohio: > 1,000 kWh per month

Duke Ohio: > 2,000 kWh per month

FirstEnergy: > 1,000 kWh per month

Over the next several years, the decoupling of rates will increase costs most for customers that use very small amounts of energy. Conversely, consumers with greater energy needs will face only a minor cost increase, and if they hit the breakeven point, will be able to keep the same annual energy bill. For utility customers with extremely high levels of usage, the yearly cost may actually decrease by a few dollars. Regardless of the situation, CEA is here to help you keep informed about changes and developments to the utility industry in Ohio.

For more information on specific cost changes for each company, or for assistance with determining how your rate may increase, email us at We are happy to help!