Thu January 2, 2014
Energy Bill Stirs Major Debate in Statehouse
Maybe it didn’t get as much public attention as some of the other hot-button topics like abortion and gun laws, but inside the Statehouse, the energy bill was one of the most contentious issues of 2013 with an aggressive battle between Ohio’s top utilities and a variety of advocates in the debate over the state’s energy policies.
Just the rumor of changing Ohio’s energy efficiency policies at the end of 2012 set off a whirlwind of activity on Capitol Square.
Then in February that rumor took the form of Senate Bill 58. At first the bill’s sponsor, Republican Senator Bill Seitz of Cincinnati, called it a placeholder bill in order to hold hearings and review the policies and standards created in 2008.
Industry experts lined up to provide testimony, talking about the impacts of the current standards. One of the most vocal groups was FirstEnergy which has been calling on the state to change its energy policies.
FirstEnergy says the provisions from 2008 are outdated and warns that consumers will see more expensive electric bills in the future if the state doesn’t make any changes.
Both sides admit that the proposals in SB58 are complex and not so easy to understand, but in the end the question at the heart of the debate is this: will the energy bill avoid or create higher costs for the ratepayer?
Doug Colafella, FirstEnergy’s spokesperson, says the legislation makes three major changes to help Ohioans save on their electric bill.
He says SB58 would change the way energy efficiency is counted, it would allow large industrial companies to opt out of programs if they create their own, and it would create a spending cap.
“Many of the opponents of this bill are very inaccurately suggesting that this bill is going to increase rates at the same time we have charged our customers over $700 million in less than five years for the compliance targets in this law.”
Opponents of the bill say the changes weaken Ohio’s renewable standards and efficiency policies. Consumer and advanced energy advocates say one of the most troubling changes would result in a windfall for top Ohio utilities such as FirstEnergy.
Scott Gerfen with the Office of the Ohio Consumers’ Counsel says an increased return of lost revenue and shared savings means the utilities are guaranteed to get more money and that money will come from Ohio consumers.
“Utilities want the legislature to vote for a law that’s going to raise electric bills for Ohio families, farmers, businesses and manufacturers. That’s a bad idea,” says Gerfen.
The consumers’ counsel says the average Ohio household could see as much as a $500 increase to their bill over a three-year period. But Colafella says the spending cap measure ensures that utilities can’t pad their own pockets with ratepayer money.
Along with the cost measures, the bill would also do away with something known as the “Buy Ohio” provision, which requires utilities to get at least 50% of their renewable energy from in-state. Similar laws around the country have been found unconstitutional, according to Senator Seitz.
Advanced energy advocates say it’s unfair to change the five-year-old policies and want state leaders to give the current standards more time to sink in. Seitz disagrees.
“You show me a business that adopted a 20 year business plan in 2008 and never revises it over the next 20 years and I’ll eat my hat. This is what happens all the time in the real world.”
The bill had momentum going into the summer break, but that seemed to slow down after more groups came out in opposition, including the Ohio Manufacturers’ Association. The bill was scheduled for a possible vote twice but both meetings were canceled and the legislation stalled in committee. Seitz, who is also the committee chairman, says he wanted to give his members more time to consider the proposed changes.
Now he has a new blueprint for pursuing policy changes in 2014. Seitz plans to continue working on SB58 but he also wants to hold more meetings on another bill that would repeal Ohio’s efficiency standards altogether. The third prong to the senator’s plan is to explore a possible legal challenge to the Buy Ohio provision.