Dayton, Ohio-Based Electric Utilitys Deregulation Plan Cleared ? 09/22/2000 
KRTBN Knight-Ridder Tribune Business News: Dayton Daily News - Ohio Copyright 
(C) 2000 KRTBN Knight Ridder Tribune Business News; Source: World Reporter 
(TM) 

COLUMBUS, Ohio--The Dayton Power and Light Co. on Thursday received final 
approval of its deregulation plan, setting the stage for residents and 
businesses to shop for electricity Jan. 1.

The Public Utilities Commission of Ohio endorsed DP&L's transition plan that 
includes a 5 percent reduction in the generation portion of residential 
electric bills and three-year cap on rates. The discount is expected to save 
the average DPcustomer $2.50 per month over the next three years. 

"With (Thursday's) PUCO approval, DPhas a transition plan in place that 
increases our growth potential in a competitive market," said Allen M. Hill, 
president and chief executive officer of DPL Inc., parent company of DP&L. 
"At the same time, it provides customers with a smooth transition to a 
deregulated supply market."

DPprovides electric energy generation, transmission and distribution 
services to approximately 500,000 customers in all or part of 24 counties in 
west central Ohio.

Utility deregulation is a trend across the nation as state regulators seek to 
lower prices for electricity, telephone and natural gas by replacing 
monopolies with competition. Under deregulation, electric service is divided 
three ways--generation, transmission and local distribution.

DP&L's three-year plan, versus five years for most Ohio utilities, places a 
ceiling on the cost customers pay for electric generation for three years 
while fixing transmission charges for six years.

Customers will have the choice of shopping for electric power from various 
suppliers, including DP&L. Those who stay with DPwill get the 5 percent 
discount.

Names of potential competitors have not been identified.

Those who select a new power supplier will have the electricity delivered 
over DPlines. The utility will be encouraged to offer incentives so that 20 
percent of its customers will shop around.

After three years, DPwill have no restrictions on what it may charge for 
electric generation. The utility also will have the flexibility to purchase 
or sell assets without PUCO approval.

However, competition from new suppliers is expected to keep electric rates 
under control, according to Robert S. Tongren, Ohio Consumers' Counsel.

"The new generation (capacity) being proposed and built right now in the 
state of Ohio is gigantic," Tongren said. "It is huge."

He said California experienced post-deregulation price spikes during a recent 
heat wave because the state is across mountains and can't tap into the U.S. 
power grid. In addition, he said price controls make it unattractive for 
companies to build new generating plants.

Tongren said his office helped write the DPtransition plan and endorses it.

PUCO Chairman Alan Schriber said the plan "provides an opportunity to 
jump-start the market by providing the resources for retail customers to 
begin to shop for competitive generation services."

Schriber, a Dayton native, said the plan came before the PUCO as a settlement 
in which the overwhelming majority of intervenors either supported or did not 
oppose the resolution of the very complex issues inherent in this case.

"Nevertheless, the commissioners carefully scrutinized every aspect of the 
settlement and determined that its approval is in the public interest," he 
said. "Considered in its totality, we believe that our order approving the 
settlement will provide DPcustomers the protection they are entitled to 
along with the opportunity to acclimate themselves to the idea of shopping 
for electricity." Folder Name: Utilities, Electric: Deregulation Relevance 
Score on Scale of 100: 
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