Energy

Tax cut may lower utility bills, PUCO orders utilities to set aside savings for customers

The PUCO has ordered the state’s utilities to prepare to lower rates it has been charging customers to “recover” federal taxes, as allowed by state law. The commission reasons that the lower tax bills utilities will now enjoy because of the cut in federal corporate tax rates from 35 to 21 percent should go to customers. Under state law, the regulated utilities can pass along tax burdens to customers.

CLEVELAND — “The Ohio Public Utilities Commission on Wednesday ordered the state’s utilities to start setting aside the estimated savings from a reduction in federal corporate taxes from 35 percent to 21 percent.

Those savings, the commission reasoned, should go to utility customers because by state law, the PUCO allows the regulated companies to “recover” expenses, including federal taxes, from their customers.

‘Broadly speaking, the Commission authorizes utilities to recover expenses from their customers, including federal tax obligations,’ said PUCO Chairman Asim Haque after the vote.  ‘If that federal tax obligation is reduced, then utility rates should also be reduced, creating savings to customers.’

As with most business before the commission, determining those savings won’t be quick. And maybe not easy. ”

— John Funk, Cleveland Plain Dealer

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