COLUMBUS, Ohio --- Freezing state energy programs for three years -- as Republican lawmakers are preparing to do -- won't help consumers or most businesses, but it will leave intact provisions that "tilt the balance" away from customers and to electric utilities.
That's the bottom line in an
completed by the Ohio Consumers' Counsel and the Ohio Manufacturers' Association.
The consumers' counsel and the OMA want lawmakers to consider a number of far-reaching changes that they regard as real reform rather than tinkering to satisfy a complaint.
"We welcome a review of the standards and want to be in a position to help the legislature improve the 2008 law," said Eric Burkland, president of the OMA, in an interview.
In testimony before the Ohio Senate's Public Utilities Committee this week, Consumers' Counsel Bruce Weston argued that the 2008 law requiring utilities to help customers pay for energy efficiency programs and deliver more power made by wind and solar could use a thorough review rather than just deletion of parts of the law the utilities don't like while lawmakers "study" the issue.
"Thaw the freeze," Weston told the lawmakers in testimony that included a six-point comprehensive rewrite of the law instead, a rewrite aimed at cleaning up a number of provisions the agency and the OMA see as giveaways to the utilities.
"I appreciate, in concept, the idea of a study committee," Weston said. "It would be preferable, however, to not freeze the (annual) energy efficiency and renewable benchmarks while the study ... is in progress. Any changes in the law could be made after the study committee completes its report."
The OMA/OCC testimony and package of proposed
includes a major change suggested just weeks ago by Todd Snitchler, former chairman of the Public Utilities Commission of Ohio, a traditionally conservative Republican and a free market advocate.
In a separate opinion accompanying a unanimously approved PUCO order looking into whether there is true competition in electric service, Snitchler argued that current PUCO-approved rate plans should be scrapped and that power prices should be set strictly by competition. He also recommended that lawmakers consider requiring utilities to sell off their power plants, not put them into subsidiaries they control.
The consumers' counsel and the OMA agree with Snitchler on getting rid of the rate plans because, they argue, the utilities have been using these so-called "electric security plans" to tuck all sort of extra charges into bills, many of which belong in a separate rate plan that determines distribution, or delivery, rates after months of public hearings.
"The electric security plans are not needed," the joint OMA/OCC proposal argues. "These plans allow utilities to charge for costs other than market prices for generation (electricity) at a time when Ohioans should be benefiting from the current low market price for electricity."
The current law also allows utilities "to include above-market, non-bypassable generation/stability charges in an electric security plan even though the utility is or will be operating in a competitive marketplace," the OMA/OCC reform package notes.
Weston and the OMA are recommending a thorough review similar to one completed by Florida lawmakers, who contracted with a team of outside experts to let all utilities and their customers air their complaints before making reform recommendations.
Ohio lawmakers, in contrast, are proposing a committee of lawmakers, utility and business representatives, who would have three years to meet, but without a proscribed schedule.
Efficiency and renewable proponents see the proposed bill and 36-month freeze as a ruse to permanently kill the programs that have led to more than $600 million in wind farm developments alone and hundreds of millions of dollars more in efficiency upgrades and solar installations.
They argue that wind and solar industries will head to other states, and that the pace of efficiency upgrades in Ohio will stall.
The 2008 law requires electric utilities to help customers use less and less electricity annually through energy efficiency, cutting consumption by 22.5 percent by 2025, compared to 2009 levels.
And it requires the power companies to sell more and more wind and solar power so that by the same date, renewable power will account for 12.5 percent of the electricity sold in the state.
FirstEnergy Corp. has publicly complained about the requirements for at least two years and tried unsuccessfully in the past to get the law changed because it has "interfered with normal market growth."And the company has tried to encourage opponents.
Anthony Alexander, CEO, president and executive director of FirstEnergy, recently told a luncheon audience at the U.S. Chamber of Commerce in Washington, D.C., "these policies and others are designed to achieve a social agenda that has little, if anything, to do with maintaining electric service."
FirstEnergy, however, has not testified on the pending legislation, or in support of a similar bill that failed to win support last fall. Nor have the state's other utilities. Yet the language in the bills addresses their complaints.
The 2008 legislation was signed into law six years ago today, making Ohio one of the early states trying to reduce the need for more coal-fired power plants.
The proposal now under consideration in the Senate would make Ohio the first state to effectively abandon green energy and efficiency -- handing Gov. John Kasich an election year nightmare. Kasich has not publicly said whether he would veto the bill, sign it or allow it to go into effect without his signature.