Wait, what is going on in Ohio?

Campaigns for corporate bailouts and clean energy rollbacks, funded by ‘dark money’ for years. Wait, what is going on in Ohio? ​

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​Ohio House Bill 6 (HB 6) was signed into law on July 23, 2019 to subsidize two nuclear plants, two coal plants, and provide at least one company with enough financial security to continue operating another coal plant. Here’s the breakdown on the plants:

• Perry Nuclear Generation Facility, owned by FirstEnergy, with a nameplate capacity of 1,256 MW. This one appears to have always been a real doozy, costing $6.024 billion and took 13 years to complete. Turns out this was supposed to be a two-unit facility but after nearly completing the second unit, including building the 500 foot tall cooling tower, construction was suspended because it proved to be uneconomic in 1985.
• Davis-Besse Nuclear Power Station, owned by FirstEnergy, with a nameplate capacity of 894 MW. Unlike the financial debacle its sibling caused, Davis-Besse has actually proved to be the more dangerous one. In 1985, the facility experienced a loss-of-feedwater accident resulting in a Nuclear Regulatory Commission (NRC) closing the plant for a year. And then, in 2002 boric acid had eaten through a steel-reactor lid, leading to another NRC shutdown of two years. 
• Kyger Creek Power Plant, owned by Ohio Valley Electric Corp with a nameplate capacity of 1,000 MW in coal, that could have started receiving Social Security two years ago if it was a person.
• Clifty Creek Power Plant, owned by Ohio Valley Electric Corp with a nameplate of 1,300 MW in coal, also of Social Security collection age, but the thing with ole’ Clifty is that it’s not even in Ohio, and this concerned resident living next to it sums it up very well with: 
  
  • “Here in Madison, Indiana, we need to protect ourselves from the OVEC Clifty Creek coal plant. We don’t need Ohioans to bail it out.”
• W. H. Sammis Power Plant, also owned by FirstEnergy with a nameplate of 2,233 MW from coal. BUT- this one is technically not going to receive any subsidies. Yep, FirstEnergy had it slated for retirement but upon the passing of HB 6, the company decided that they would be in good enough financial health to keep it open.
  

​Let’s focus on the W. H. Sammis coal plant for a second. Did FirstEnergy threaten to close down a plant, laying off workers (i.e. voters) if they didn’t get a ratepayer bailout for their nuclear facilities? Maybe, but according to testimony filed into this proceeding by Americans for Prosperity, FirstEnergy and FirstEnergy Solutions would be positioned to collect over 3,000% on their Return on Investment (ROI), in the passing of HB 6. Furthermore, we don’t even know if they are in fact losing money on their two nuclear facilities, as FirstEnergy has refused to disclose that information. Why?? Ironically, bankruptcy, which throws in a whole ‘nother vantage point. 

​During bankruptcy proceedings, companies cannot hide monies spent on lobbyists and PR firms in the same way. The Energy Policy Institute compiled FirstEnergy Solution’s bankruptcy filings, show that from March - December 2018 that they paid $2.7 million to convince lawmakers to support a nuclear bailout.  

Turns out, this concept of bailing-out nuclear facilities has been hanging out at the Ohio Legislature since 2017, the powers at be just needed to hire politicians to pass it through. Data from The Federal Election Commission cites $1.65 million in campaign cash from Ohio’s vested utilities, including American Electric Power (AEP), Dayton Power & Light (and it’s parent company AES Corporation), Duke Energy, and FirstEnergy Corp.’s PACs, and over $320K to the Ohio House members that voted for this bill. With this kind of spending, just how much do these corporate interests have to gain? Quite literally, $150 million to bail-out two nuclear facilities that have not proven to be uneconomical. So yeah, I guess that would put them in better financial health. 

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Under the bill, from 2021 until 2027 every Ohio electricity customer would pay a new monthly surcharge that ranges from 85 cents for residential customers to $2,400 for large industrial plants. Also, starting next January, ratepayers around the state would also have to chip in up to $1.50 monthly (and up to $1,500 per month for commercial and industrial users) to subsidize coal plants in Ohio and Indiana run by the Ohio Valley Electric Corp. But, if you’re familiar with this story (or if you have been diligently clicking through my links), this bill is touted as a way to lower bills, to the tune of $1.3 billion as touted by State Rep. Wilkin. Behold, the birth of a really good talking point. 

HB 6 removes the $4.74 monthly average for residential customers that is slated for cost-effective energy efficiency programs and investments in renewables, in favor of throwing ratepayer money at ‘money-losing technology’ essentially just driving electric bills up, as R Street Institute noted it filed testimony. The problem here is that Rep. Wilkin is only counting the $4.74 as a cost, and discounting the benefits. Energy efficiency programs are designed to be cost-effective. A Center for American Progress report found that every dollar invested in Ohio’s energy efficiency programs resulted in more than $2 in near-term savings for ratepayers, and an Ohio State University analysis found that in the first four years, the combined renewables and efficiency mandates lowered electricity rates by 1.4 percent. Basically, HB 6 is just forcing Ohioans to make poor investments that are going to cost much more in the long run.
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BUT, it’s not over yet! If you’re upset about this, just imagine how the natural gas industry (and their investors) feels. Coal and nuclear have a pretty significant lobby, but I can assure you we’re not slated to get a shiny new gas plant in New Orleans based on its merit. The peculiar twist here is HB 6 is bringing together the natural gas industry and merchant generators that rely on market signals, as well as consumer advocates, environmentalists and the clean energy industry, among others. Although many groups have not gone public yet, the Ohioans Against Corporate Bailouts has formally submitted petition language aimed at sending HB 6 to the ballot for a popular vote in the 2020 election. 

​So what happens when corporate interests with dark money do battle against each other in state politics? Initially it sounds like a race to the bottom, with a crash course in political theater, campaign funding law, and expensive PR messaging for those that are paying attention, but I would argue that it’s not worth writing off just yet. Those of us that believe in clean energy, that advocate on behalf of the consumer, and/or the environment, that understand the value of energy efficiency, have a very real seat at this table. In fact, you can learn about Ohio Citizen Action’s campaign here, or peruse through Ohio Consumers’ Council’s filed testimony here. 

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Keep an eye on this Louisiana. Our coal and nuclear assets are aging as well, and no one should have to subsidize toxic generation.