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Industry Milestones & Significant Events

2000 – Present

Trends

Advanced metering infrastructure (AMI) is enabling utilities to develop new products and services such as:

“Fracking” has rejuvenated the natural gas industry.

The super Derecho on June 29, 2012, with winds speeds up to 85 miles per hour, resulted in power outages to 660,000 customers.

Supply  & Demand

Lower prices and new sources of natural gas caused an increase in natural gas production, and reduction in use of coal.

     Ohio generation output 2011:

Source: Edison Electric Institute

http://www.puco.ohio.gov/puco/index.cfm/consumer-information/consumer-topics/where-does-ohioe28099s-electricity-come-from/

Regulations

Ohio State Bill 221 requires utilities to implement energy efficiency programs to achieve reductions in energy usage from 2009 to 2025.

More than 34 gigawatts (GW) of electrical generating capacity are set to retire because of the Environmental Protection Agency’s (EPA) Mercury and Air Toxics Rule regulations.  Most of these retirements are from coal-fired power plants.

PUCO revokes AEP Ohio Electric Security Plan settlement agreement on February 23, 2012. 

1975 – 1999

Trends

Two trends – deregulation of markets and environmentalism – started an emphasis on different approaches to developing energy sources, including attempts to conserve energy, reduce pollution, and improve public health.

Supply  & Demand

  In 1996, AEP's sales of electricity to retail customers topped 100 billion kilowatt hours for the first time in the company's history.

  By 1989, only 30 percent of the natural gas moving through Columbia's pipelines was owned by the company, compared with 90 percent a decade earlier.

 The recession during the 1980s caused energy demand to fall, and energy prices worldwide collapsed. Columbia still had long-term contracts with producers to buy natural gas at the high prices of the late 1970s, and was forced to buy gas whether or not it could be sold.

Regulations

Ohio's original electricity deregulation bill was passed in 1999.

In the mid-80s, the Federal Energy Regulatory Commission rules required pipelines to ship other                 distributors' gas.

During the 1980s, problems with regulatory approval process forced gas prices to be artificially high.  As a result, many of Columbia's industrial customers defected to cheaper energy sources.

Legislation passed in 1978 effectively deregulated the prices gas producers could charge at the wellhead. Intended to give incentive to producers to drill new wells, it resulted in very rich, long-term deals at guaranteed rates for producers.

1950 – 1974

Trends

Carbon-based fuels sustained the ongoing postwar economic expansion.

Supply  & Demand

The OPEC oil embargo in 1974 sent the price of oil to new heights.

Columbia's gas sales reached a new peak in 1972.

Demand for natural gas doubled between 1956 and 1970.  Demand heavily outweighed supply.  Columbia blamed U.S. regulation of interstate gas prices for this situation. Columbia looked to liquefied natural gas (LNG) imports to help fill the gap between supply and demand.

Although the price of natural gas was climbing, the cost of heating a home in Columbus, Ohio was still about half that of using heating oil.

Between 1961 and 1975, AEP added 21 new generating units to bring total system generating capacity to 17.6 million kilowatts.

Regulations

The National Environmental Policy Act, the Environmental Protection Agency (EPA), and the Clean Air Act (all originating in 1970) kicked off a decade of environmental policy-making.

 

1900 – 1950

Trends

By 1900, cities were being electrified.
The first electric refrigerator was invented in 1913.
The first night baseball game in major league was played in 1935, made possible by electric lighting.

Supply  & Demand

After WWII, demand for natural gas was so high that suppliers could not keep up with demand, and Columbia had to turn down new requests for service.  Gas shortages continued until the early 1950s.

The Depression during the 30s stalled the growth of electricity demand.

During the 1920s, electricity quickly became the engine that powered America.

Regulations

Regulators initially promoted industry interests.  They restricted competition, guaranteed returns on investment, and encouraged expansion of services. The theory was that this would provide reliable, abundant, and cheap energy to consumers.

Energy regulation happened on an industry-by-industry basis, with no real attempt to coordinate policies across the entire market.

Prior to 1900

The first commercial electric utility was built by Thomas Edison in New York in 1882.

Utility and transportation regulation began in Ohio when the General Assembly established the Office of the Commissioner of Railroads and Telegraphs in 1867.

Manufactured natural gas was first introduced to the U.S. when it was used to light the streets of Baltimore, Maryland in 1816