The year-old electric choice program hasn't caught on among Cincinnati-area consumers, but it is gaining momentum among area businesses.

        The latest evidence is Procter & Gamble Co., which has picked AES NewEnergy to supply power to its Cincinnati corporate offices and most of its other operations in Southwest Ohio.

        Terms of the 17-month agreement weren't announced, but P&G said it picked the unit of Arlington, Va.-based AES Corp. after reviewing all of its competitive options.

        “AES NewEnergy was the best match for our needs,” said Beth Emanuelson, P&G's senior energy purchasing manager.

        Shawn Smith, AES New Energy business development manager, said P&G's switching will encourage other businesses to shop as well.

        Ohio's electric choice law allows businesses and consumers to shop for a power supplier, while local utilities, such as Cincinnati Gas & Electric Co., continue to provide delivery and related services. The aim is to introduce competition into what has been a utility monopoly to foster lower prices.

        While choice has caught on in northern Ohio, where power rates are higher, competition has been slow to develop in CG&E's service area and other parts of southern Ohio where electricity is cheaper.

        The volume of Cincinnati Gas & Electric Co.'s residential customers who have switched suppliers is less than 1 percent, according to the latest data from the Cinergy Corp. subsidiary.

        Officials say CG&E's relatively low electric rates and only one competitive offer, from New Power Co., have limited residential switching.

        But among CG&E's commercial customers, almost 10 percent have switched to one of a handful of competing suppliers such as AES.

        Lower wholesale electric rates and the recession, which has dampened power demand, have triggered an increase in electricity shopping by businesses, CG&E spokesman Dave Woodburn said.

        “Electric prices have come down so businesses are able to get a better deal,” he said, noting that the percentage of commercial switching has increased from just under 6 percent in October.

        The percentages are key, because the electric choice law requires that 20 percent of each customer group — residential, commercial and industrial — buy power from alternative suppliers by the end of 2005. If individual utilities don't achieve the 20 percent threshold, the law gives Ohio regulators authority to step in to spur competition.

        AES NewEnergy, which was the first alternative supplier to flow power in Ohio a year ago when the choice law took effect, thinks that 20 percent of CG&E's commercial and industrial customers will be buying power from other suppliers by the end of this year.

        To encourage switching, CG&E's choice program offers “shopping credits” on the generation portion of customer's bills. Those credits are higher for the first 20 percent who switch. AES's Mr. Smith said switching is gaining momentum among business customers because they want to qualify for the higher shopping credit.

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