David v. Goliath

For several years, Findlay City Council has tried to stay out of a power struggle between Goliath (American Electric Power) and David (Hancock-Wood Electric Co-op).
But it won’t be able to until it acts to protect H-W from being run out of town.
Hancock County’s lone electric providers had played well for years. AEP has a municipal franchise that entitles it to residential and commercial customers within the city limits, while H-W has a territorial franchise which provides the same, but mostly in rural areas.
The arrangement, however, doesn’t prevent conflicts which can arise when land is annexed into Findlay, and both utilities lay claim to a new business.
For over 30 years, the two companies worked through those situations. The company which acquired the new electric account would “swap” some of its territory to the other to help balance the load.
The agreed-upon revised territories would be sent to the Public Utilities Commission of Ohio, which would update the electric maps. The give-and-take, however, has ended. Lately, AEP has been grabbing the new large commercial businesses, leaving H-W out of the process and offering little, if anything, in return.
As a result, H-W has asked council to amend its territorial agreement through legislation, with hopes it would encourage the previous business arrangement with AEP, and, if not, to provide H-W needed documentation to file an unfair business practices complaint against AEP with the PUCO.
Council, however, nixed the legislation last summer and again last Wednesday, and in doing so kicked the can down the road.
While all sides in the dispute have been invited to a council committee meeting today, it remains to be seen what will be accomplished, if anything. Council has already spent countless hours in committee examining the matter, after all, and has now twice rejected legislation.
Still, council’s refusal to act is troubling, and sends the wrong message to smaller companies, like H-W, which offers competitive rates and has a good service record, yet lacks the political clout and financial backing to compete with powerhouses like AEP.
Hancock County needs both AEP and H-W to keep rates competitive. Each should have an opportunity to compete for new business in overlapping territories, and each should have the opportunity to be at the table. That isn’t happening now.
The playing field will never be level. AEP already has the majority of the electric business in Findlay, and H-W’s territory continues to shrink with each annexation.
Council can no longer sit idly by and allow Goliath to bully David. The PUCO polices the state’s utilities, but the original municipal and territorial franchises were created through acts of council and can be amended by council.
Unfortunately, the issue may have gotten too political to be fully resolved on the local level. There are simply too many conflicts of interest.
H-W has invested heavily in infrastructure in its territory on the east side of Findlay in preparation for future business, only to have new commercial business yanked out from under it.
If AEP’s power grab is allowed to continue unabated, H-W will eventually have little choice but to raise rates on its existing customers to pay down its stranded utility debt. Council’s rejection of the H-W requests has left AEP with total control of the new commercial electric market, and contributed to AEP’s unwillingness to negotiate fairly with H-W.
Perhaps the Findlay-Hancock County Alliance, the economic development agency of which both utilities are members, can orchestrate a cooperative agreement that helps resolve the community-wide issue.
But if the two sides can no longer play nice, council should finally pass legislation that allows H-W to make its case in Columbus.
If it doesn’t, it will show council is in AEP’s back pocket. Worse yet, it sends the wrong message to any small business which tries to stand up to a big one in Findlay.


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