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
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
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
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
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
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
"If opponents successfully place the issue on the November 2020 ballot, political consultants are expecting an expensive advertising campaign that could dwarf the approximately $15 million total spent by campaigns on both sides of the issue aimed at voter awareness of the position of their representatives and senators.
The long-rumored referendum petition appears to have been anticipated by the GOP majority, which pushed for passage of HB 6.
Approved Tuesday in the GOP dominated Ohio House by a 51 to 38 vote, mostly along partisan lines, the measure would provide FirstEnergy Solutions, owner of two Ohio nuclear plants, with about $1.1 billion through 2027, rather than through 2026 as originally planned.
The extra year means the company would not lose a year of payments if the law does not go into effect until November 2020, provided that voters reject the potential ballot initiative."
— John Funk, Utility Dive
'"We are bailing out a corporation, a failing corporation,' while harming the growing wind and solar industries, said Rep. Casey Weinstein, a Democrat.
He said the legislation would steer solar and wind investment away from Ohio and toward neighboring states such as Michigan. Other states, including South Carolina and Georgia, are being much more forward thinking about renewable energy, he said.
The Ohio Senate passed the bill 19-12 last week, but the House put off its vote until Tuesday because several lawmakers were absent and the bill would not have passed without them.
DeWine's office went so far as to approve the use of state aircraft to pick up two lawmakers from a conference in Chicago so they would be in Columbus for the Tuesday vote, though that flight plan was eventually canceled when the lawmakers determined they could drive back."
— Dan Gearino, InsideClimate News
"The Nature Conservancy said Ohio lawmakers missed an opportunity to develop a comprehensive energy policy.
'HB 6 is a step back from what we have currently in statute for the clean energy standards. This is not a comprehensive energy bill. Instead, this bill compromises successful policies that have supported renewable energy and energy efficiency to provide a legislative vehicle for a nuclear and coal bailout,' the group said in a statement.
Nuclear advocates cheered the bill's passage.
'Today's decision echoes support we've seen in New Jersey, New York, Illinois and Connecticut and reaffirms the major role nuclear carbon free energy has in lowering carbon emissions,' Maria Korsnick, president and CEO of the Nuclear Energy Institute, said in a statement.
The Ohio Consumers' Counsel and the Ohio Manufacturers' Association urged the governor for a veto, condemning the measure in a joint statement as 'the latest and maybe the worst of the retreats from competitive markets undertaken by the Ohio legislature' in the 20 years since the state embarked on deregulation.
Other groups that opposed the bill continue to look for ways to reverse the governor's action.
'We are open to all options, including a voter referendum, to kill this costly bailout bill and get Ohio back on track as a clean energy leader,' Dick Munson, director of regulatory and legislative affairs for the Environmental Defense Fund, told Utility Dive via email."
— John Funk, Utility Dive
"'In a written statement, FirstEnergy Solutions said it’s still optimistic about the nuclear subsidies bill passing, and if it does it will reevaluate their options. The statement goes on to say that the company remains committed to the process, which results in an 'increased financial burden associated with missing the June 30 fuel purchasing deadline.'"
Tracy Sabetta, a consultant for the Ohio Consumers Power Alliance, has her own take on this statement.
'So the deadline was important but they will still happily take the money from consumers as long as the Legislature passes something soon,' says Sabetta.
Her group is against the bill and says it’s important for the Senate to take more time to look over the possible changes, given there are 50 proposed amendments.
'So I applaud the Senate for taking that step back and looking for ways to make this bill better rather than just catering to the deadline set by the corporation that stands to benefit the most from the legislation,' Sabetta says.
The House and Senate held sessions over the weekend, a rare move in the Legislature, to try to hash out a budget compromise. At the same time, the Senate Energy and Public Utilities Committee was holding hearings on the energy bill."
- Andy Chow, Statehouse News Bureau