Clean Energy Law Revisited

Apr 15, 2013

A law on standards for power companies that passed almost unanimously five years ago is getting another look. Supporters of the idea say it’s sparked by changes in Ohio’s energy landscape, but critics say they’re shocked and angry.

Statehouse correspondent Karen Kasler has an overview of this politically charged debate.

The so-called Clean Energy Law requires utilities to put in place energy efficiency standards that achieve a 22% savings by 2025, and demands that electric utilities get 25% of their power from advanced energy and renewable resources by that same target year. Republican Sen. Bill Seitz of Cincinnati says a lot has changed since that law passed in 2008.
“Any time you’re on a 20 year plan, it’s prudent to check in and see how you’re doing.”

Seitz says a predicted increase in demand and in price for electricity hasn’t happened, and that was before the discovery of huge deposits of natural gas in shale in Ohio. Seitz says a proposal to freeze the energy efficiency standards came to him from FirstEnergy. The utility’s spokesman Doug Colafella says it has conversations with lawmakers all the time, and that the company is meeting the annual targets. But he says it hasn’t come cheap.
“Since 2009, utilities like FirstEnergy across the state have charged customers over half a billion dollars for these programs and at this point we’ve achieved a reduction of about 2.3%. We still have to get to 22%.”

Colafella says FirstEnergy doesn’t have a position on the renewables requirement in the law, but says the utility is concerned that as the annual goals on energy efficiency get more aggressive, the programs to get to those goals will get more expensive – and the costs will be passed on to consumers. But groups that supported the law are fighting back. Nolan Moser is with the Ohio Environmental Council, which has concerns about coal-fired and nuclear plants.
“You pay for energy efficiency, absolutely. Just like you pay for power. Just like you pay for the wires as part of the utility system. You pay about $2-3 on your bill for energy efficiency. A new power plant that would provide the same amount of energy is going to cost you $15 per month.”

But Moser says the law has brought economic activity to Ohio and savings to utility customers. He says American Electric Power spent $400 million on energy efficiency programs that saved customers $1.5 billion. And he notes the 305-megawatt Bluecreek Wind Farm in western Ohio was a $600 million investment. And in northeast Ohio, a coalition of business and government groups has formed to oppose changes to the law. Matt Zone is a city councilman in Cleveland, which has seen economic activity that he says directly relates to the standards in the law.
“There’s a real role for government. We have to create the opportunity and the environment for businesses to thrive. There was a very courageous and nearly unanimous vote in 2008 by the state legislature. I mean, what are we going to say – are we going to turn back?”

But Sen. Seitz isn’t convinced that these savings have been beneficial to customers.
“Everybody wants to reduce carbon emissions. Everybody wants cleaner air and cleaner water. But at what price? People are all for it until they find out what it costs.”

Colafella is more direct.
“It’s not clear how much customers are saving, but it’s very clear what customers are spending and what customers are paying for these programs. If the communities that we serve are struggling economically, that’s not good for FirstEnergy and that’s not good for anyone.

But Nolan Moser says FirstEnergy is simply not telling the truth when it comes to energy efficiency.
“FirstEnergy does not like these standards. At the end of the day, FirstEnergy wants to sell you more energy and they want you to pay as much as you possibly can for it.”

Later this month, there’s another hearing scheduled on revisiting the law in the committee that Seitz chairs. He says he hopes to take input from all sides and come up with a piece of legislation that may make some changes in the law.