Dominion Energy Ohio sells to Enbridge. What does this mean for natural gas consumers?

Dominion Energy Ohio, which is the regulated natural gas utility for 1.2 million customers in Ohio, has been bought by a Canadian gas utility. What does this mean for consumers?

The sale of three of Dominion’s gas utilities to Enbridge must still pass government approval and is expected to close by the end of 2024.

The three Dominion gas utilities serve 3 million customers in Ohio, North Carolina, Utah, Wyoming and Idaho.

If the sale is approved by federal and state officials, Enbridge will become North America's largest natural gas utility franchise with more than 7 million customers delivering more than 9 billion cubic feet a day of natural gas.

For Ohio customers, there will be very few changes for customers and their rates due to the sale, according to officials from both companies and the Public Utilities Commission of Ohio (PUCO).

“For now, these utilities will retain their current names, there are no changes to customer rates or services resulting from this announcement, and customers can continue to interact with their respective utility as they do today,” said Andrea Stass, manager of external communications and media relations for Enbridge.

Matt Schilling, spokesman for the PUCO, which regulates utilities in the state, said little will change for customers.

“From our perspective and probably the consumers, very little in the short term will change,” he said. “Eventually, assuming the transaction goes through, their bills may change from Dominion East Ohio to Enbridge or whatever they rename the subsidiary.”

Something similar happened in 2018 when CenterPoint Energy bought Vectren, the regulated utility serving the Dayton area, Schilling said.

In that case, the PUCO did a review to make sure no transaction costs from the sale would make their way into rates, he said.

“We would expect the new utility to adopt all the rates and tariffs and everything,” said Schilling. “Now, of course, they might come in on day one and decide they want to pursue changes but all that would have to go through a brand new regulatory process.”

Dominion Energy actually will be undergoing a rate case soon. The PUCO requested that Dominion file a rate case to review distribution costs, or the regulated portion of the bill charged to deliver gas to customers, by Oct. 31. The last rate case for Dominion was in 2008.

Dominion has not filed but intends to by the Oct. 31 deadline, said Dominion spokeswoman Stephanie Moore. Even if rates are changed in the rate case, Moore said changes in prices wouldn’t be anticipated until 2025.

Bill explained

The Dominion bill is made up of two parts.

The regulated portion, or monthly service fee and other riders, are approved by the PUCO and are for costs to deliver gas to homes and businesses.

The second part of the bill is for supply. Dominion does not make money on the supply of gas. Under the Energy Choice Program, customers can choose their own supplier. That may be a company’s contract rate through the PUCO’s Apples to Apples chart, a government aggregation rate or many customers have been choosing Dominion’s default rate, or Standard Choice Offer (SCO).

The SCO changes monthly and is based on a state-approved formula and is determined by using the closing price on the third to last day of the previous month on the New York Mercantile Exchange (NYMEX) plus an "adder," which is determined every February in a supplier auction. SCO prices have been at near market prices since earlier this year.

Customers’ agreements with suppliers or government aggregations and the SCO price formula will not change as a result of this sale, officials from Dominion, Enbridge and the PUCO confirmed.

Schilling with the PUCO said Enbridge would have to file a full regulatory case to change the methodology of how the SCO is determined.

Betty Lin-Fisher: Shopping for natural gas or electricity rates in Dominion, FirstEnergy area? Start here

Employees not immediately affected

Dominion Energy Ohio’s 1,500 employees, many of whom are in the Akron area, have a two-year job protection program from Enbridge after the close of the sale, said Moore.

"No significant operational changes are anticipated," Stass said. "We see a bright future for these companies, and while some things will undoubtedly change over time, our intention is to grow these businesses.

"It is early days still, and our focus is on working through the various approvals to close the deal. At this time, we don’t have details on things like potential name changes to the bills, company names or rates.”

The company is headquartered in Calgary, Canada, and has more than 10,000 employees, Stass said.

Enbridge also intends to continue projects Dominion has already started, including the 25-year plus massive pipeline replacement program of its aging pipelines.

In total, Dominion is replacing more than 5,500 miles across Northeast Ohio and Western Ohio. In the Akron area, Dominion serves parts of Summit, Stark, Portage and Medina counties.

“Everything is business as usual,” said Moore.

If the name Enbridge sounds familiar to Northeast Ohioans, it may be because the Canadian company is half-owner of the NEXUS gas pipeline, a 36-inch diameter line that carries natural gas produced by Utica and Marcellus shale wells to users in Ohio, Michigan and Canada. The pipeline's 255-mile course cuts across portions of Summit, Stark, Wayne and Medina counties. Detroit-based DTE Energy is Enbridge's equal partner in the venture.

To find out the latest advice from Consumer reporter and columnist Betty Lin-Fisher about natural gas and electric pricing, go to her online Utility Guide at www.tinyurl.com/UtilityGuide She can be reached at 330-996-3724 or blinfisher@thebeaconjournal.com

This article originally appeared on Akron Beacon Journal: How will Dominion Energy sale impact consumers? We have the answers