Bill credits and long-term savings now likely following federal ruling on RTO adder fee
Ohio electric customers are in line for refunds and long-term bill reductions after the U.S. Supreme Court declined to hear an appeal from several utilities over a controversial transmission charge known as the “RTO adder.”
The decision leaves in place a January ruling from the U.S. Sixth Circuit Court of Appeals, which found that utilities in Ohio should not have been charging the adder because joining a regional transmission organization is mandatory under state law. The adder was originally created as a financial incentive for utilities in states where membership was voluntary.
The Ohio Consumers’ Counsel (OCC) called the outcome a major win for households statewide. OCC estimates more than $400 million in total savings through 2031 once the adder is fully removed from Ohio transmission rates.
The utilities involved in the appeal included FirstEnergy’s transmission arm (ATSI), Duke Energy Ohio, and American Electric Power’s transmission subsidiaries. FirstEnergy and Duke both face refund obligations for charges collected back to February 24, 2022, when the OCC first challenged the fee. FirstEnergy has already recorded more than $40 million in expected refunds in federal filings.
AEP Ohio and AES Ohio customers will not receive refunds tied to this case. AES was never authorized to collect the adder, and AEP was blocked from applying it in a 2022 federal decision. Those customers will still benefit from the fee’s elimination going forward.
Regulators and the utilities must now determine the exact amounts owed to customers and how payments will be issued. Refunds are expected to be applied automatically through future bill credits or mailed checks once approved.
What This Means For Your Bill
Who will get refunds:
• FirstEnergy (Ohio Edison, The Illuminating Company, Toledo Edison) transmission customers.
• Duke Energy Ohio electric customers.
Refunds will cover RTO adder charges paid since February 24, 2022.
The exact refund amount per household has not been finalized.
Who will not receive refunds from this case:
• AES Ohio (formerly Dayton Power & Light) customers.
• AEP Ohio customers.
These utilities either never charged the adder or were blocked from doing so earlier, so there is no backpay to return.
How refunds will be delivered:
You do not need to apply for anything. Credits or checks will be issued automatically once calculations are completed by the Public Utilities Commission of Ohio and the companies.
Long-term impact:
Once the adder is fully removed, Ohioans will see lower transmission costs, one portion of the electric bill. This will not zero out transmission charges, but statewide savings are projected to exceed $400 million through 2031.