Lawmakers push to overhaul Ohio’s energy standards

Manufacturers: watering down efficiency requirements will hurt Ohio’s economic recovery

A bill will be coming soon to overhaul Ohio’s standards for renewable energy and energy efficiency, according to a state lawmaker leading hearings on the issue.

Hearings on Ohio’s 2008 energy law that requires power companies to produce 12.5 percent of their energy from renewable sources such as wind, hydroelectric and solar panels by 2025, wrapped up last week. The law also requires similar investments in advanced energy sources such as nuclear technology and clean coal, and for power companies to cut electricity use through efficiency programs.

Sen. Bill Seitz, R-Cincinnati, said he hopes to introduce a bill overhauling the 2008 law as soon as the end of the month.

Seitz, who in 2011 co-sponsored legislation to repeal the renewable energy standards, said he intends to only update and clarify aspects of the law this time around.

“It behooves any wise person to check in. No one I know of stays with an 18-year plan and doesn’t make suitable changes to the plan when market conditions change,” Seitz said.

Environmental groups have cried foul, saying changing the standards could undermine economic growth in the green energy field that has brought hundreds of millions in investment to Ohio. Their position has been bolstered by support from the Ohio Manufacturers’ Association, which recently issued a report that said the efficiency standards will save consumers more than $5.5 billion through 2020; in part by reducing energy demand and, in turn, energy costs. Indirectly, the standards will help create jobs manufacturing products like insulation and heading and cooling components, the OMA said.

“Watering down the standards or eliminating them entirely would be an unfortunate and risky step backward for Ohio – and a blow to broader economic recovery efforts,” said OMA President Eric Burkland.

Brian Kaiser, director of green jobs and innovation for the Ohio Environmental Council, said solar projects have brought hundreds of millions of investments to Ohio since 2008 because of the standards.

“Without these policies, this investment is going to somewhere else. And if it goes somewhere else, Ohio is going to find itself again on the losing side of the 21st-century economy,” Kaiser said.

FirstEnergy, Ohio’s largest electric utility and parent company of Ohio Edison, is leading the charge against the efficiency standards. Company spokesman Doug Colafella said conditions have changed since the standards were created in 2008: namely, the advent of “fracking” and the resulting natural gas boom, as well as falling energy prices.

The mandates have artificially pushed down demand for electricity, making it hard to attract investors to build natural gas-fired power plants in Ohio, Colafella said.

FirstEnergy also argues the mandates are expensive for the public. The company says consumers of Ohio’s four major electric utilities— AEP Ohio, FirstEnergy, Duke Energy and Dayton Power & Light — have paid more than $500 million since 2009 in surcharges to pay for efficiency programs, he said. The $5.5 billion in savings identified by the OMA are just “guesstimates,” he said.

“So what we’re left with is a set of energy efficiency mandates that are costing customers a lot of money, and they don’t even apply to today’s challenges,” Colafella said.

Ohio’s other major electric providers have not taken as strong of a public position as FirstEnergy has. AEP Ohio opposes repealing the renewable energy standards because of the investments they’ve already made in wind and solar power, but is officially neutral otherwise, company officials said.

DP&L does not have a position on the Senate talks, a company spokeswoman said in an email. Officials with Duke Energy did not return messages seeking comment.