Professor sees flaw in argument that energy bill is a "tax increase"

Public Utilities Commission of Ohio voting

Photo by Karen Kasler

"A Columbus law firm argues that the new energy law charging electric customers up to $2.35 a month for nuclear, coal, and solar subsidies is a tax increase.

'Here, the charges levied under HB6 are imposed by the legislature, upon a broad class of parties, and for a public purpose,' writes John Zeiger, attorney with Zeiger, Tigges, and Little. 

The memo was sent to the Ohio Secretary of State's office in hopes of thwarting an attempt to put a referendum of the energy bill on the 2020 ballot. Under the Ohio Constitution, voters cannot reject a tax increase through a referendum.

Ned Hill, an energy economics professor for Ohio State University, does not agree with that line of thinking. He says, if that were the case, then the Public Utilities Commission of Ohio has approved several tax increases over the years.

'All the other non-bypassable riders that have been larded onto your electricity bills over the past six years are also taxes and maybe legally questionable,' says Hill."

- Andy Chow, Statehouse News Bureau 

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Six things you need to know about Ohio’s energy efficiency rollback

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"Historically, Ohio utilities were required to get pre-approval for their energy efficiency programs. Pre-approval required a formal docket proceeding before the PUCO in which portfolio offerings were evaluated, stakeholders could comment on the energy efficiency programs and robust analysis improved portfolio cost-effectiveness and innovation.

In 2018 and 2019, the PUCO changed the energy efficiency portfolio planning process to eliminate pre-approval and instead implement a post-program annual audit. Under the new rules, existing plans are deemed reasonable unless the PUCO decides to take action.  

These regulatory changes, coupled with H.B. 6, mean that energy efficiency plans for 2020 could change. Several utilities will file their updated portfolio plans September 1. Upon receiving the plan filings, the PUCO could take action and open a docket proceeding, although they are no longer required to do so."

- Nick Hromalik, Midwest Energy Efficiency Alliance (MEEA)

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Renewable Energy Sizzles, Natural Gas Fizzles

"Due to regional and seasonal energy use patterns, renewables may lose their lead over the short term, but EIA expects renewables to put in a strong showing this summer. In May, the agency issued a forecast for the summer of 2019 under the somewhat ominous headline, “EIA expects less electricity to come from coal this summer as natural gas, renewables rise.”

EIA anticipates a slight decrease in electricity demand this summer, from June through August, compared to 2018. The agency forecasts that coal will be especially vulnerable, sliding to a 25 percent share of U.S. electricity generation for the three-month period.

By way of comparison, in the summer of 2015, coal’s share was 35 percent.

Natural gas will once again top coal by a wide margin this summer. According to the forecast, gas will account for 40 percent of U.S. power generation for the summer of 2019, up slightly from its 39 percent share in 2018. Meanwhile, EIA expects hydropower and other renewables to account for a respectable total of 16 percent for the summer of 2019, up slightly from last year."

- Tina Casey, Triple Pundit  

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Ohio nuclear bailout foes take initial steps toward statewide referendum

COLUMBUS — "The group Ohioans Against Corporate Bailouts announced in a release that it turned in 2,866 petition signatures to Ohio Secretary of State Frank LaRose’s office from registered Ohio voters in favor of the referendum. The group also submitted proposed summary language – a succinct explanation of the proposal provided to voters asked to sign a petition supporting the measure – to Ohio Attorney General Dave Yost’s office.

If Yost OKs the summary language and LaRose certifies that at least 1,000 of the petition signatures are valid, HB6 opponents can then start collecting the 265,774 petition signatures needed for the issue to appear on the November 2020 ballot.

'Ohio families and businesses know H.B. 6 is a costly attack on Ohio consumers,' said Gene Pierce, spokesman for Ohioans Against Corporate Bailouts, in a statement. 'This is the first step in rolling back this corporate bailout and reinstating Ohio's renewable standards.'

Ohioans Against Corporate Bailouts, backed by environmental and business groups, formed a couple of hours after Gov. Mike DeWine signed HB6 last Tuesday."

— Jeremy Pelzer, cleveland.com 

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Ohio Republicans balked at a nuclear bailout, so the industry elected new Republicans — And walked away with $1.1 billion

"Several dark-money groups spent millions to replace key Republican state legislators in the spring of 2018, followed by a furious lobbying campaign to make sure those new lawmakers elected a new House speaker — one who was amenable to the subsidy. The nuclear industry in Ohio has been on the brink of failure for several years, but previous legislatures had objected to a bailout, reading the writing on the wall: Nuclear power is neither a cost-effective solution for power nor an effective response to climate change, despite hopes for its success.

In April 2018, two nuclear plants, both owned by the electric utility FirstEnergy, filed for bankruptcy and have been threatening to cease operations if not bailed out. They were under increasing pressure to compete with cheaper alternatives, ranging from natural gas to wind and solar. The bankruptcy filingsgive a glimpse into the company’s political spending: more than $30 million from 2018-2019 on lobbying and campaigns in Ohio and Pennsylvania (where the company also sought a bailout, so far unsuccessfully).

The dark-money effort deployed a variety of vehicles that went by names like the Conservative Leadership Alliance and the Ohio Clean Energy Jobs Alliance. Murray Energy, a coal company, also gave heavily to current state House Speaker Larry Householder and his allied candidates, and the bailout from Ohio also includes subsidies to prop up failing coal plants in the state.

The payoff is extraordinary in degree — something like $30 million for campaigns in Ohio and Pennsylvania to win $1.1 billion in government subsidy. But it is similar in kind to other nuclear projects across the country. According to the Environmental Working Group, a nonprofit devoted to research and advocacy, five cash-strapped states across the country have foisted more than $15 billion in subsidies on failing nuclear power plants since 2016, the latest sign that nuclear is unable to stand in a competitive energy market against lower-cost renewables."

— Ryan Grim, Akela Lacy, The Intercept 

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Think tank: Nuclear plants' bankrupt owner spent heavily for bailout

COLUMBUS — Dave Anderson, the San Francisco-based Energy and Policy Institute’s policy and communications manager, said bankruptcy filings show lobbying firms were getting paid by FirstEnergy Solutions with the permission of the court. Then FirstEnergy Solutions and the lobbying firms were launching pro-bailout coalitions like the Ohio Clean Energy Jobs Alliance.

'It provided a rare window into the inner workings of what are supposedly grassroots campaigns,' he said.

The almost $50 million in spending is separate from the millions spent on both sides of the Ohio fight on TV and radio ads and mailers. A pro-bailout group, Generation Now, is a dark money super PAC that is estimated to have spent more than $9 million on TV and radio ads. It will eventually have to reveal the sources of its money to the IRS.

The Ohio Consumer Power Alliance financed a series of radio ads and mailers in opposition to the bill.

House Speaker Larry Householder (R., Glenford) said the entities funding Generation Now are 'people who are employees who want to keep their jobs in the state of Ohio and corporations that are headquartered in the state of Ohio that want to stay in the state of Ohio…'

He also said that Generation Now was acting defensively in its spending after the natural gas industry started to attack house members’ efforts to pass the bill."

— Jim Provance, The Blade 

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Clean Energy Future president vows H.B. 6 referendum

COLUMBUS — "A referendum committee has been formed to overturn legislation signed into law Tuesday that subsidizes two nuclear plants owned by FirstEnergy Solutions.

The announcement by Bill Siderewicz, president of Boston-based Clean Energy Future, followed House Bill 6 being signed into law Tuesday afternoon by Gov. Mike DeWine. The bill passed by a 51-38 vote in the Ohio House of Representatives. On July 17, it was approved by a 19-12 vote in the Ohio Senate.

The legislation will apply monthly surcharges of $2.50 for residential energy customers, $20 for commercial customers and $250 for customers classified as industrial. It also creates the Ohio Clean Air Quality Development Authority, which would provide during the first year 'clean air credits' under the Ohio Clean Air program to power plants, such as nuclear power plants, that produce zero carbon emissions."

— George Nelson, The Business Journal

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DeWine signs energy bailout bill

Two of Ohio Valley Electric Corp.'s coal plants will receive subsidies under House Bill 6. (William Alden/Flickr)

COLUMBUS — "Gov. Mike DeWine signed House Bill 6 on Tuesday, just hours after it was passed by the Legislature. The law imposes an energy tax on electric customers to subsidize First Energy's two northern Ohio nuclear plants, as well as Ohio Valley Electric Corp.'s Kyger Creek coal plant in Ohio and the Clifty Creek coal plant in Indiana.

Richard Hill of Madison, Ind., has lived near Clifty Creek for most of his life and said he believes it's wasteful to bail out aging coal plants when their pollution threatens communities. 

'They're trying to force ratepayers to pay for something that's not economical and not clean,' he said, 'and there are definitely better alternatives that they should be exploring.'

Hill said other utility companies are moving away from coal and investing in renewable sources such as wind and solar. HB 6 also ends the state's renewable-energy and energy-efficiency programs, but provides some funds for solar and wind power.

Supporters have claimed the law will save Ohio about $640 million and incentivize renewable energy. Backers of the bill also have predicted that without the subsidies, more than 4,000 jobs would be put at risk. However, Hill noted that the OVEC coal plants have been around since the 1950s. 

'It is a pretty major employer' he said, 'but it's been there so long that surely the company and even the local workers would have to assume that, at some point, it's going to outlive its usefulness, which it has.'"

— Mary Schuermann Kuhlman, Public News Service 

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Ohio Gov. DeWine signs bill to bail out nuclear plants, slash renewable energy

COLUMBUS — "Ohio lawmakers pitched the legislation as a cost-saver for ratepayers, saying they offset the new fee with cuts to incentives for renewable energy, such as wind and solar, and the elimination of fees used to push companies becoming more energy efficient in making and delivering energy by 2020.

Lawmakers in the Ohio House of Representatives sent the bill to DeWine Tuesday afternoon with a narrow, 51-38 vote. The governor signed it shortly after.

'Our goal all along has been to save the nuclear plants, save the jobs but also to keep the cost of energy down for the ratepayer,' DeWine told reporters Thursday. 'I think House Bill 6 does that.'

The bill passed less than a week after House Speaker Larry Householder said he didn't have enough support present to pass the legislation. On Monday, House leadership even asked to borrow a state-owned plane to fly lawmakers back from a Chicago conference for the vote. That plan was later ditched, according to a Dayton Daily News report."

— Jessie Balmert, Cincinnati Enquirer

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Nuclear subsidy opponents already working to hold referendum on Ohio House Bill 6

COLUMBUS — "To put the measure on the ballot, Ohioans Against Corporate Bailouts needs to collect an initial 1,000 petition signatures from registered Ohio voters within 90 days of the bill’s signing, as well as get the go-ahead from the secretary of state, attorney general, and the Ohio Ballot Board. If the group clears those hurdles, it would then need to collect an additional 265,774 petition signatures to put HB6 up for a vote.

Even if all that happens, HB6 opponents would need to raise millions of dollars to win against the bill’s well-funded backers -- such as Generation Now, a nonprofit that has spent more than $9.5 million to date on TV and radio ads in support of the legislation, according to political ad tracker Medium Buying. Generation Now’s business address is a house owned by a political adviser to Ohio House Speaker Larry Householder.

The legislation, introduced in April, offers a $150 million-per-year bailout to Ohio’s two nuclear power plants, owned by FirstEnergy Solutions. The bill also eviscerates the state’s renewable-energy and energy-efficiency standards for utilities (which ratepayers currently pay a surcharge to fund), creates publicly funded subsidies to the Ohio Valley Electric Corporation to shore up its coal-fired power plants in Ohio and Indiana, and gives $20 million per year to six solar plant projects."

— Jeremy Pelzer, cleveland.com

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