News Stories

AES Ohio – “AES Ohio expects that load growth from data centers will exert downward pressure on its regulated delivery rates, given their significant contributions to the costs of existing and new 2 grid infrastructure. To promote this outcome, AES Ohio has entered bilateral contracts with prospective data center customers to require them to pay their fair share, including minimum demand requirements, defined term lengths, and exit fees, among other provisions. AES Ohio has filed these contracts with the Federal Energy Regulatory Commission.”

“AES Ohio agrees with AEP Ohio that as market reforms are debated at PJM and the federal level, the Commission should take steps – within Ohio’s regulatory framework – to protect customers from the impact of data center load on default generation service. Given the magnitude of that load, the risk of data centers using default generation service could place a significant risk premium on competitive auction results, driving up supply charges. For this very reason, AES Ohio has secured contractual commitments from data center customers to shop for their own electric supply and not rely on default service.”

“AES Ohio, nevertheless, urges the Commission not to adopt a one-size-fits-all approach to address this issue. What may be right for AEP Ohio customers may not be a good fit across the state. For example, although AES Ohio believes that any default supply for data centers should be procured separately from the current competitive bid process for other customers, AES Ohio may propose holding periodic auctions to identify standby default suppliers for data centers to mitigate any provider-of-last-resort risk on the utility and avoid significant advance notice requirements or other processes that may be difficult to implement on an accelerated, ad hoc basis.”

Amazon Data – “Under AEP Ohio’s request for interim relief, large load data centers should provide 180 days’ notice in advance of returning to SSO service.8 If timely notice is provided, “a separate procurement or auction product should be procured for data center load being served by the SSO.”9 In the absence of a 180-day notice, AEP Ohio proposes to procure energy for data centers on SSO service through spot market purchases.10

ADS does not oppose AEP Ohio’s proposed interim relief, although respectfully submits that several important clarifications are necessary. First, the Commission should make clear that the 180-day notice provision does not limit the right or ability of a data center customer to return to or otherwise obtain default SSO service within a monthly billing cycle as has been the standard practice in Ohio for many years. ADS believes AEP Ohio is not seeking that limitation, but clarity in any ruling on this issue is important.”

“Second, to the extent spot-market purchases are made to serve large load data centers on SSO, ADS submits that Locational Marginal Pricing (“LMP”) in the Day‑Ahead Market in PJM is the appropriate market-based mechanism to utilize during any period during which a large load data center receives SSO service through spot-market procurement. That is because most indexed energy products in the retail market states in PJM are based on PJM’s Day-Ahead Market, and for this reason that market has greater liquidity and less volatility than PJM”s Real-Time Market.”

“ADS respectfully submits that scheduling through the Day-Ahead Market would provide greater cost certainty and reduce volatility that can occur in the Real-Time Market. Accordingly, if AEP Ohio’s interim relief is approved, the Commission should clarify that any spot market purchases made for large load data centers on SSO should be conducted through PJM’s Day-Ahead Market, without additional margin or mark-up, so that any affected data centers are charged market rates for their generation.”

“Third, and finally, AEP Ohio’s application does not specify which “large load data centers” are encompassed within the proposed interim relief. During the technical conference held on ADS respectfully submits that the proposed interim relief should not be limited to data centers but should instead include all AEP Ohio customers that meet these criteria, i.e. any customer taking SSO service with a monthly maximum demand of greater than 25,000 kW at a single location or an aggregated contract capacity greater than 25,000 kW. AEP Ohio’s application states that it is proposing a separate SSO process for data centers “to help prevent pricing impacts of such large load shifts for SSO customers.”16 ADS understands and appreciates AEP Ohio’s concern in this regard. But AEP Ohio’s proposed solution does not recognize that the pricing impacts are the same whether the large load returning to SSO service is a data center or another type of customer.”

Constellation – The risk of data center migration to and from default service can be addressed by the competitive market. – “The competitive market can easily provide a solution to the risk of data center migration to the SSO. While Constellation believes all large-load customers should have their default supply collectively procured through separate utility-specific auctions, procuring supply for a data center class appropriately allocates the costs and risks associated with serving that class. Just as important, Constellation believes that the competitive market can provide a solution that adheres to competitive market principles and follows the law in Ohio (i.e., competitive market supplies the generation,3 no advance notice to return to SSO4 and no minimum stay on the SSO5 ).”

AEP Ohio’s proposed interim relief is not sufficient and should not be adopted. – “The Commission should reject AEP Ohio’s interim three “principles” to address SSO migration by data centers, similar to its previous attempts to impose anti-competitive provisions. AEP Ohio’s proposal would require 180-day advance notice prior to returning to SSO, have AEP Ohio procure spot market purchases in the event 180-day notice cannot be given and then have a separate procurement or auction held for the specific load returning to SSO. Implicit in the proposal is a minimum stay for the data center customer prior to returning to competitive service. This structure, however, was rejected by parties in the data center proceeding and is legally flawed.”

The Commission should not rush to adopt AEP Ohio’s three-point interim proposal because it lacks details, was not presented with key information or supporting testimony, and was not subject to stakeholder examination or analysis.- “In addition to receiving comments from Constellation and other interested parties and the many concerns they point out about AEP Ohio’s interim proposal, the Commission should recognize that, at best, AEP Ohio presented a bare-bones interim proposal. It consists of a few sentences, lacks important information for consideration (e.g., costs), and was not supported by testimony. The Commission should not and does not need to rush to issue an order here – even if the ruling will be on an interim basis. The Commission can and should, instead, collect additional information such as the costs associated with the interim proposal and allow stakeholders to engage in discovery and provide that information before weighing in further and prior to implementing an interim solution. An adequate record is lacking.”

Google – A. Google generally supports an interim solution until the RBA is finalized. However, any interim solution approved by the Commission should be just that – interim.  – “Google supports the goal of protecting AEP Ohio’s SSO residential and small business customers from the cost increases and volatility that could occur if large load customers who are subject to RBA costs, return to SSO service. Google agrees with AEP Ohio that some form of interim solution is appropriate while federal and PJM-level reforms are finalized.

Although certain interim measures can be adopted now, these should not be treated as permanent changes that could conflict with eventual federal decisions concerning the RBA. Accordingly, Google supports the Commission’s consideration of interim relief in Phase 1 but urges that any such relief be: (1) temporary in nature; (2) structured to facilitate a consistent statewide approach to large load default service; and (3) flexible enough to accommodate forthcoming PJM and federal decisions governing the RBA.”

1. Google recommends that any separate procurement or auction product for data center load be specifically designed to align with the definition of “load” established in the final, FERC-approved PJM Reliability Backstop Procurement proposal. – “In its filing, AEP Ohio refers to the need for an interim solution applying only to “large load data centers.” This approach is inconsistent with the definition of “large load additions” proposed in the January 2026 PJM Board Letter. To ensure that RBA prices accurately follow the customers driving those specific costs, the Commission should adopt the PJM Board’s proposed threshold of “individual additions of load at or above 50 MW at a single Point of Interconnection,” for the interim solution, with loads below that threshold considered on a case-by-case basis. The final definition should align with the eventual FERC-approved definition. This alignment ensures regional 25776365v3 5 consistency, adheres to the principle of cost-causation, and facilitates the uniform implementation of SSO mechanics across all EDU service territories in Ohio.”
2. Google urges the Commission to develop a broader collaborative process and implement a statewide approach for this issue. – “Given that initial comments are expected to present specific proposals and alternatives for interim relief, and because reply comments are due only one week later, there will be insufficient time for stakeholders to properly evaluate these complex submissions. As a result, the Commission should require additional stakeholder feedback and dialogue, such as supplemental workshops, following this comment period to ensure a robust and well-vetted outcome.

“Additionally, a Commission-led statewide effort to implement an interim solution is warranted. Addressing this issue, one electric utility at a time will cause inconsistency across the electric utilities’ service territories. Further, the issue of protecting SSO customers from price volatility and risk premiums that could arise as a result of large load migration is not unique to AEP Ohio and has been debated in Commission proceedings for several years.”

“Finally, the implementation of recently enacted House Bill 15 provides further justification for a statewide process. House Bill 15 eliminates ESPs under R.C. 4928.143 and allows Ohio’s IOUs to establish a SSO only through a market rate offer (“MRO”). As a result, current ESPs will terminate after the final SSO auction delivery period approved by the PUCO,8 and Ohio’s IOUs will need to establish an SSO via an MRO. The finalization of the RBA may still be pending when this transition from ESP occurs. A statewide process can anticipate and plan for the impact of this transition to put interim solutions in place until the RBA is finalized.”

IGS – A. The Commission should not adopt AEP Ohio’s proposal to conduct separate SSO auctions for certain customer classes. “If the Commission sees a need for a default service product, IGS recommends that it be a product provided by the market. These customers would be referred to a retail supplier that is registered with AEP, willing to take on the load, and has a monthly rate available for the data center customers. This referral program would eliminate the need for both a separate auction to choose a supplier, advanced notice requirements and minimum stay that restricts the customer from shopping. As a supplier that serves shopping and standard service offer customer load, IGS believes that the default service product for data center customers should be established through a referral program that will protect the SSO while providing these customers with a competitive rate—should they find a need for default service while in the process of choosing a supplier.”

“IGS proposes to create a new program called “Supplier of Last Resort” (“SOLR”) for data center customers much like what IGS proposed in the last data center tariff case. 3 The SOLR would exist as a product of the retail energy market. Like other shopping customers, eligible customers will have the opportunity to shop with a CRES provider and have access to detailed service rates that would be presented in a standardized format from SOLRs that choose to participate in the program and are registered with AEP Ohio. If, for example, the hyperscale customer does not select a SOLR, the customer would go through a round robin process and be assigned to a SOLR’s standard monthly rate product. This proposal would eliminate the need for separate auction to choose a supplier, the 180-day notice requirements and any need for a minimum stay on shopping that would impede the customer’s ability to select a long-term retail product.”

1. 180 Day Notice is Anticompetitive and Contrary to Shopping Principles – “Item 6 would require data center customers to provide 180 days’ advance notice before returning to the SSO. While IGS recognizes the importance of operational planning, a mandatory 180-day notice period is inconsistent with competitive retail electric market norms and would operate primarily as a barrier to customer choice.”
2. Utility Spot Procurement is Unnecessary if Referral Program Adopted – “Item 7 proposes that if adequate notice is not provided, AEP Ohio would serve returning data center load through spot‑market purchases until a separate procurement can be conducted. Although the information provided to date is insufficient to fully assess the scope or final form of AEP Ohio’s proposal, the limited details currently available raise concerns regarding consistency with customer choice and a competitive generation supply market.”

Ohio Manufacturers’ Association Energy Group (OMAEG) –  A. There should not be a minimum stay requirement for data center customers that return to the SSO. “OMAEG recommends the alternative approach that would not place the large load that returns to default service in the standard SSO. Rather, a separate competitive procurement should occur without a minimum stay provision.”

Competitive Auctions should be supplied by suppliers and not AEP Ohio – “In short, Ohio law does not allow AEP Ohio to participate in the business of generating power and energy for their SSO customers, or otherwise directly procuring power and energy supply for customers. Therefore, AEP Ohio’s proposed tariff solution to allow AEP Ohio to procure spot market purchases and supply the returning customer does not comport with the longstanding established SSO framework or Ohio law.17 Supply for all default service customers, including data centers, should be provided by SSO suppliers, not AEP Ohio.

OMAEG does, however, agree with AEP Ohio’s proposal that AEP Ohio be required to conduct a separate CBP for the data center load that returns to the SSO and have that customer’s load provided by a competitive supplier (i.e., the winning bidder).18 To prevent unnecessary costs imposed on other SSO customers, such CBP auction should only occur if the data center returns to the SSO and all costs of the separate auction should be borne by the returning data center customer.”

“Additionally, while OMAEG is not opposed to requiring notice, 180 days seems excessive as most large customers would likely not return to the SSO if they had that amount of advanced notice of such need to return to the SSO as those customers could competitively shop for their generation on the open market within that 180-day window. It is important to note that these rules should not apply if there is an inadvertent return to the SSO, either through the utility’s CHOICE process (i.e., timing of drop and switch requests) or a corporate restructure that causes a name change or a tax identification change that unintentionally triggers an account change and, therefore, a utility drop that forces the customer back to the SSO.”

Duration of Interim Relief – “AEP Ohio’s Application is requesting that its proposed interim relief be adopted until the new tariff solution can be adopted.19 AEP Ohio appears to be tying the interim relief to what has been defined as Phase 2 by the Commission’s Entry. As explained above, OMAEG does not believe that this proceeding should have a Phase 2 that is isolated to AEP Ohio. Any data center load concerns should be addressed on a statewide and/or regional basis and should not be considered as an AEP Ohio issue. As such, OMAEG urges the Commission to address grid infrastructure reliability for the whole State, once there is more guidance from PJM and the FERC, rather than in this AEP Ohio-specific case. OMAEG does support that any interim relief provided to AEP Ohio through this proceeding be adopted until a state-wide solution can be implemented after the requisite FERC and PJM proposals are vetted and reforms deployed.”

PUCO Staff – “Due to their large size, in combination with the inability to readily anticipate their switching behavior, large loads present an unpredictable and unhedgeable material risk to suppliers, the cost of which is passed on to SSO customers in the form of risk premiums included in supplier bids. AEP Ohio’s proposal seeks to mitigate this risk as data centers continue to grow in size and number in the Company’s service territory.”

“Staff recommends that AEP Ohio’s request for interim relief be granted, consistent with these comments. Staff believes that it is important to have backstop procedures in place to protect ratepayers if a large data center were to return to the SSO, although Staff expects that large data centers will consistently procure generation service in the competitive market.”

“Because a data center customer returning to SSO service would bear the full cost of any procurement conducted on its behalf, Staff would oppose any proposal that seeks to conduct a separate procurement prospectively, without assurances that any particular customer would be taking service under that tariff. Conducting a separate procurement would likely require the Company to engage with an independent auction administrator, and the PUCO would likely continue to retain a consultant to evaluate the results in a fashion similar to the existing SSO auction procurement process. These costs should not be incurred unless it is already established that a customer or set of customers stands ready to bear them.”

“The Company proposes that if the customer does not provide sufficient advance notice of its return to the SSO, spot market purchases be conducted on the customer’s behalf. Staff recognizes that PJM Interconnection operates competitive energy, capacity, and ancillary service markets in the region that can be leveraged to serve load in the absence of a supplier contract. While the prices arising out of these markets may be volatile, they do represent a competitively determined alternative that can be utilized on a short-term basis without the Company incurring any unnecessary risk on behalf of the load. Staff supports the proposal for spot market purchases when an auction is unable to be held but would oppose the Company’s engaging in any hedging or other risk management strategies on behalf of the returning load.”

RESA – A. The Commission should clarify that the scope of this proceeding is limited to the issue of whether and how large data center loads can return to SSO supply.  “Aware of the potential impacts to others on the SSO, and aware of the uniqueness of hyperscale data center load, the Commission previously declined to modify AEP Ohio’s SSO auction product. While changes at the federal level could necessitate minor or major changes at Ohio’s retail level, those potential changes are still at the early stages of being discussed. Before the parties proceed to fully flesh out details of proposals and respond to others’ proposals, the Commission should provide direction after the comment stage about (1) whether it intends to consider any interim changes at this time or defer changes until the conclusion of the PJM/federal review process, (2) whether it intends to consider interim changes but do so on a statewide basis in a different proceeding or address proposals on an AEP Ohio-specific process in this proceeding, and (3) whether it believes any changes to AEP Ohio’s SSO process would be permissible in light of the requirements of HB 15. Providing this guidance up front will prevent unnecessary waste resources by the Commission, its Staff, and parties.”

1. The Commission should ensure that any interim relief for hyperscale data center load is rooted in Ohio’s competitive market framework. – “There are two fundamentals17 that the Commission must follow when evaluating any potential changes to the current SSO generation procurement process. First, generation is a competitive retail electric service and should be provided through competitive suppliers. Second, the Commission should not revive unlawful and unreasonable minimum stays that restrict customer choice. Evaluating proposals against the backdrop of these fundamentals will ensure that any resulting changes foster competition and enable customers receive the benefits of competition.”
2. Any interim relief must respect the Master Supply Agreements governing the Commission-approved auction results. – “AEP Ohio’s guiding principles for interim changes are silent on the requirements of the Master Supply Agreements. Notably, these Master Supply Agreements govern the SSO auctions and are presently in force. Any consideration of interim changes, to the extent permissible, must occur within the contours of the existing Master Supply Agreement framework.”
3. Any interim relief needs to be temporary and reevaluated once final details emerge from the PJM/federal processes. – “AEP Ohio’s Application begins by referencing a letter to PJM that outlined concerns about the impacts from the additions of hyperscale data center loads. Of course, AEP Ohio’s Application does not identify any concrete changes in the PJM processes as there are ongoing discussions about what changes, if any, to adopt and the specific details of these changes.

Specifically, AEP Ohio’s fifth guiding principle states that “[i]f for some reason the RBA price does not follow the data center customer MWs when they return to the SSO, a separate procurement or auction product should be procured for data center load being served by the SSO (i.e., so that the data centers can pay the full price of their procurement without impacting the regular SSO price).”31 Again, the details of the RBP are not finalized so it is impossible to respond to how capacity pricing for data centers will occur and the mechanism by which RBP price will follow a data center. In fact, basic details such as which data center load (new vs. new/existing) will be subject to any RBP or whether the new capacity procurement process will be limited to just data centers has not yet been determined. For example, while AEP Ohio’s Application appears to suggest that all new and existing data centers should be separated into this new SSO interim generation procurement structure the Organization of PJM States (“OPSI”) issued a “Goal and Objective” proposing that the reliability backstop procurement process apply to New Large Loads which it defined as “all loads greater than 50 MW entering service on or after June 1, 2027.”32

Accordingly, AEP Ohio’s interim concepts, and specifically its fifth guiding principle, are premature (the other two should be rejected for other reasons). To the extent the Commission considers any interim modifications to the existing SSO CBP auction terms and conditions, it should be completely independent from the RBP process. Any changes, interim or otherwise, that are linked to the RBP process should be deferred until the details of that RBP process are finalized.”

Read all comments here.