Jan 17 - McClatchy-Tribune Regional News - Laura A. Bischoff Dayton Daily News, Ohio

Companies that use huge amounts of electricity sometimes get secret "side deals" with utilities that knock millions of dollars off their power bills -- discounts that other customers end up subsidizing. An energy bill pending before the Ohio House would allow the side dealing to continue, but subject it to disclosure and approval by the Public Utilities Commission of Ohio.

"It won't stop the deals, but it will then give me the opportunity to say 'Hey, who is paying for this?,' " said Ohio Consumers' Counsel Janine Migden-Ostrander, who represents 4.5 million residential utility customers -- folks who help pay for the side discounts without ever being offered such a deal themselves.

Hundreds, if not thousands, of side deals -- worth millions of dollars in the aggregate --have been carved out since Ohio moved to deregulate its electricity market in 1999, Migden-Ostrander said.

Side deals and special contracts were debated Wednesday before the House Public Utilities Committee, which is considering the energy bill proposed by Gov. Ted Strickland and passed by the Senate last fall.

Special contracts are similar to side deals, except that the big power customers typically agree to give up something in exchange for the discount and the arrangements are approved by the PUCO. Special contracts also are public records, though Migden-Ostrander said they're exceedingly tedious to analyze in the aggregate and often impossible to calculate how much they're worth. FirstEnergy discounts power by an average of two-cents per kilowatt hour to customers with special contracts -- deals worth $200 million a year, according to David Blank, FirstEnergy's vice president of rates and regulatory affairs.

Some observers say the legislation would "grandfather" these special contracts into law in perpetuity -- a move FirstEnergy and the Ohio Consumers' Counsel oppose.

Sandy Theis, spokeswoman for the Ohio Coalition for Affordable Power, said her group does not support side deals or grandfathering special contracts. In 2006, Ohioans spent $11.8 billion on electricity -- $4.8 billion from residential customers, $3.9 billion from commercial customers, and $3.1 billion from industrial users.