Columbus, Ohio – The Public Utilities Commission of Ohio (PUCO) ordered Ohio’s regulated public utilities to file applications to reduce their rates due to the Tax Cuts and Jobs Act of 2017 (TCJA).
“The PUCO remains adamant that every dime utilities collect due to the reduction in corporate taxes be returned to ratepayers,” state PUCO Chairman Asim Z. Haque. “We direct our utilities to file an application to reduce rates in order to pass along to customers the tax savings resulting from the TCJA.”
The Commission ordered electric, natural gas, water and wastewater utilities whose rates are regulated by the PUCO and serve more than 10,000 customers to file an application by Jan. 1, 2019 to reduce rates. Specifically, utility applications should address how to reduce base distribution rates, rider rates and accumulated deferred income taxes.
In its order, the Commission noted a few utilities have already reduced certain riders, or adjusted base distribution rates through recently approved rate cases.
The Commission also stressed that utilities that fail to file an application to reduce rates in compliance with today’s Commissioner order may be subject to monetary fines.
The TCJA was signed into law on Dec. 22, 2017, which among other things, reduced the federal corporate income tax rate from 35 to 21 percent, effective Jan. 1, 2018.
On Jan. 10, 2018, the Commission ordered an investigation to study the impacts of the TCJA on PUCO-regulated utilities and how best to pass on the benefits to customers, and directed utilities to set aside money in excess of the reduced tax rate to later be returned to customers.
On April 25, 2018, the Commission denied legal arguments jointly filed by Ohio’s electric distribution utilities challenging the PUCO’s January order directing utilities to set aside money in excess of the reduced corporate tax rate during the pendency of the Commission’s investigation.