A new state performance audit says Ohio's utility regulator lacks key information about its workload and has maintained cash reserves well above recommended levels. The findings arrive as the Public Utilities Commission of Ohio faces a projected 56% increase in peak electricity demand over the next two decades, driven largely by data center growth across the state.
The audit, mandated by the General Assembly in the state's biennial budget bill, examines PUCO operations, data use, staffing, finances, planning and enforcement. In its response to the performance audit, PUCO said the review covered the commission's management systems and ongoing efforts to improve them. As first reported by Cleveland.com, auditors found that the case-tracking system records filings and other documents but does not consistently connect key case steps with the staff resources used to complete them.
That gap matters because PUCO regulates electricity and natural-gas rates for the entire state, and lawmakers are watching closely as new statutory deadlines reshape how fast the commission has to move. Cleveland.com reports that PUCO lacks granular data on employee hours spent on individual parts of rate cases, a blind spot auditors say could worsen as workload climbs.
Reserves Double What's Recommended
The audit also found that PUCO's seven dedicated-purpose funds held reserves far above recommended levels. The commission had enough cash to cover at least a full year of operating expenses in every year from 2020 through 2025, and more than 18 months of expenses in some years, according to the audit findings reported by Cleveland.com. The funds are supported by assessments and fees paid by regulated utilities and other businesses, costs that can ultimately reach customers.
Auditors warned that excessive fund balances may add unnecessary costs to end users and recommended PUCO set formal minimum and maximum reserve targets. State Auditor Keith Faber said PUCO's decisions affect Ohioans' pocketbooks and that the commission should be using the analytical tools available to it, according to the report relayed by Cleveland.com.
Faber also recommended that state officials explore consolidating commercial motor carrier safety enforcement under a single agency, noting that motor vehicle safety monitoring is currently split between PUCO investigators and the Ohio State Highway Patrol, per the Ohio Auditor of State.
Pipeline Safety Fines Lag Federal Standards
The audit also flagged Ohio's pipeline-safety fine limits as among the lowest in the country. State law sets maximum fines for natural-gas pipeline-safety violations, but those limits have not kept pace with increases in federal standards. Auditors warned that falling too far behind federal benchmarks could jeopardize PUCO's federal pipeline-safety certification.
A Recent Enforcement Example
Ohio's recent enforcement history shows how pipeline-safety violations can produce civil penalties under the existing system. According to Farm and Dairy, PUCO inspections at Enbridge Gas Ohio locations between February and March 2023 found 36 instances of exposed pipelines, along with other safety, record-keeping and contractor-qualification problems.
The audit also flagged Ohio's pipeline safety fine limits as among the lowest in the country, with state law setting maximum fines for natural-gas pipeline safety violations that have remained fixed even as federal standards have increased. Auditors warned that falling too far behind federal benchmarks could jeopardize PUCO's federal pipeline-safety certification, the report states. The audit discusses federal pipeline-safety requirements and possible restrictions on PUCO's enforcement authority, according to Van Ness Feldman LLP. PUCO has previously used its enforcement powers in this area: in November 2024, the commission authorized a $350,000 civil penalty settlement with Enbridge Gas Ohio after a 2023 staff audit discovered 36 instances of exposed piping, missing records on abandoned lines, and unqualified contractor personnel, according to Farm and Dairy.
Lawmakers Split on Fix, Praise Progress
State Rep. Tristan Rader said PUCO has made meaningful change under Chair Jenifer French, but recommended Ohio automatically update pipeline safety penalties whenever federal standards change and that the legislature separately increase the state's maximum pipeline safety penalties, per Cleveland.com's report. Rader proposed outage-reimbursement legislation.
Brian Chavez said Ohioans should have confidence that PUCO has the systems and procedures in place to regulate utilities, adding that the report validates legislators' faith in the commission, according to the same Cleveland.com account.
The audit does credit PUCO with progress on other fronts. The commission has adopted a new policy governing reserve levels, is nearing completion of a formal strategic plan, and has added employees and reorganized departments in recent years. Its case-tracking system modernization is expected to eventually provide more detailed workload and staffing information. Currently, just 13 of the 32 states with regulated utility markets have publicly available strategic plans, while 19 do not.
New Deadlines Add Pressure
The staffing and reserve findings arrive as PUCO works under strict new statutory deadlines. House Bill 15, passed in 2025, imposed new completeness-review, staff-report, and final-order deadlines on the commission and, according to PUCO's own account, created a maximum 360-day processing cap for electric distribution rate cases. PUCO has met all new House Bill 15 deadlines for power-siting cases so far, and the commission says five pending utility rate cases are on track to meet the new deadlines.
Beyond imposing those deadlines, House Bill 15 eliminated utility Electric Security Plans and repealed the OVEC rider, according to the Office of the Ohio Consumers' Counsel.
Chair French leads PUCO, per the Ohio Manufacturers' Association. In November 2025, PUCO ordered FirstEnergy's three Ohio electric utilities to pay $250.70 million in customer refunds and restitution, including $180 million in treble damages tied to funds funneled into the House Bill 6 bribery scheme.
With data centers expected to drive much of the projected growth in electricity demand, questions about their effect on residential consumers remain.
