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AEP cut 164,000 Ohioans’ power for nonpayment last year, more than any other utility

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AEP cut 164,000 Ohioans’ power for nonpayment last year, more than any other utility

Jul 07, 2022 | 3:55 am ET
By Jake Zuckerman
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AEP cut 164,000 Ohioans’ power for nonpayment last year, more than any other utility
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American Electric Power headquarters in Columbus, Ohio. Getty Images.

American Electric Power disconnected more of its customers for late bills than any other utility in the state last year, new regulatory filings show.

Between June 2021 and May 2022, AEP Ohio disconnected nearly 164,000 customers from their electric service. That’s more than twice as many as its second place counterpart, FirstEnergy Corp., whose three utilities in northeast Ohio disconnected a combined 74,000 customers in the same time frame.

Adjusted for size, AEP executed about 12 disconnections for every 100 customers. For most other utilities, the rate was between 2 to 5 shutoffs per 100 customers, the data shows.

This marks the greatest number of customers AEP has disconnected from power for nonpayment in a calendar year dating at least back to 2014. State law requires Ohio utilities delivering electricity and gas to disclose their shutoff data to the Public Utilities Commission of Ohio on an annual basis.

Last year was at least the second in a row in which AEP outdid utilities around the state in terms of cutting off service for customers. The disconnections underscore the reality of entrusting investor-owned utilities, which are duty bound to shareholders, to deliver a basic human need to customers in an uncompetitive market.

Scott Blake, an AEP spokesman, filled in some details about the disconnections. He said about 75% of customers who were disconnected were reconnected the same day. Additionally, he said a small percentage of customers (less than 3%) comprise 66% of all disconnections.

With some crude math, this comes out to about 35,000 AEP customers who were each disconnected an average of three times during the course of the year. Of this cohort, Blake said he has no information as to the geography of where these shutoffs are occurring.

"AEP Ohio diligently follows the disconnection processes and rules outlined in state law and regulations. Disconnection is the last resort when are unable to work with a customer to make payment arrangements," he said.

"Our main priority is to help all customers maintain their electric service. We make assistance programs available, all notices encourage customers to call us and work with a customer service representative, and these services are made available to all customers."

Of AEP’s 1.3 million electric customers, 72% of them have “smart meters.” These allow the company to read them remotely instead of sending representatives to their homes. Likewise, they allow the company to disconnect and reconnect customers remotely.

According to the company, customers are typically notified three or more times of a pending disconnection, including a final call 48 hours beforehand. About 10% of customers who receive a final disconnection notice are actually disconnected.

Looking across seven of the largest gas and electric utilities in the state last year, the PUCO data shows the companies shut off 44% more customers than the previous 12-month period. In the year ending May 31, 2022, roughly 389,000 Ohioans were disconnected from service for nonpayment, compared to about 270,000 in 2021.

Some utilities around the state increased their rate of customer disconnections more dramatically last year. FirstEnergy, for instance, disconnected about 74,000 customers in the year ending May 31, 2022 compared to 29,000 the year prior — a 151% increase. Duke Energy and AES both increased customer disconnections by more than 50%.

In previous statements, the companies have typically defended the practice of electric shutoffs, describing them as a last resort and emphasizing available bill pay assistance and payment programs. The director of the Ohio Consumers' Counsel, which represents ratepayer interests before the PUCO, said the agency is still analyzing the filings but there's cause for concern.

"It’s concerning that there are some significant increases in the utilities’ disconnections," said OCC Executive Director Bruce Weston. "It’s a tough time economically for many people. And losing utility service can make things so much worse. Having the data is a step for consumer protection. But unfortunately, the law does not require state action on the data."

AEP, meanwhile, continues to face other criticism due to a blackout that hit 230,000 Ohio customers last month amid a heat wave. According to the company, a storm damaged several transmission lines, which overburdened other lines feeding into Columbus. The company claims it had no discretion as to which areas lost power; however, the governor, the NAACP, environmental organizations and House Democrats have all questioned AEP on this point. The matter will be reviewed in a PUCO hearing next week.