How House Bill 6 Reshaped Ohio’s Renewable Energy
Climatology Professor
The Clean Air Program has faced backlash from several sides as Ohio’s renewable energy efforts freeze through policy changes and reverting of funds.
House Bill 6, now considered the Clean Air Program, passed in the house in April of 2019. The bill took effect in October of 2019 and is aimed at subsidizing first energy’s nearly bankrupt nuclear and coal plants by lowering renewable energy mandates for public utility ratepayers.
Ohio utility users will now pay a new fee on monthly electricity bills, $2.50 for residential consumers, $15 for commercial users and $250 for industrial.
Ohio Representative Shane Wilkin of district 91 explains that the fee is expected to generate $300 million by 2021. The funds would be distributed to state power companies as $9 credits for every carbon emission-free megawatt produced.
FirstEnergy Solutions’ two large nuclear plants would collect most of the credits, an estimated $150 million, half of the fund.
Wilkin explains this $2.50 fee would replace the previous higher renewable energy mandates and customers would save an average of $1.39. The program also lowers the mandate businesses would have to pay for energy efficiency standards.
“I want to see government mandates removed,” Wilkin said. “I’m not in favor of telling a business, like a newer business they have to pay for a subsidy that could benefit a more competitive business that can meet the efficiency standards.”
The program also has incentives to invest $20 million in solar, however, many supporters of renewables are in opposition to the bill because of its massive cut to Ohio’s renewable standard profile and energy efficiency programs.
The previous requirement for energy companies was to have renewable make up 12.5% of their total energy output by 2026, the Clean Air Program cut that standard to 8%. Ohio energy companies were also enrolled in energy efficiency programs to reduce customer use by 22% by 2026, now companies are no longer required to participate in these programs once they have energy reduction at 17.5%.
Wilkin says the bill promotes clean air through investment in nuclear energy.
“The Bill keeps our two nuclear plants open,” Wilkin said. “The other renewables like solar and wind are not very efficient, whereas the nuclear plants run at 90% efficiency.”
Solar has taken a direct hit from the bill as Ohio’s solar carve-out that was instated in 2008 is being eliminated. The carve-out required companies to invest an annual percentage into specifically solar energy through either building their own farms or buying solar renewable energy credits (SRECS) which fund statewide solar projects. According to the Institute for energy economics and financial analysis, SRECS are expected to drop from $25 a credit to $6.
“If we were trying to put most of our renewable energy in solar it would be massive loss of land,” Wilkin said. “One of the largest solar fields is going to be built in my district.”
A solar project of 365 megawatts in Pike County was proposed by the Toyota company last spring.
“The farm was at least a step in the right direction, with jobs produced here,” Wilkin said. “However, it’s nearly always overcast and rainy in Highland County which is also in my district.
A surcharge will be added onto FirstEnergy customers utility bills to be used to subsidize two coal plants co-owned by AEP and Duke power, two other big electric companies in the state. The charge will be $1.50 for residential customers and up to $1500 for commercial and industrial businesses.
Business owners are also wary of the new bill due to its high surcharges and muddling of the free energy market.
“It creates new, state-mandated costs for Ohio’s electric ratepayers and manufacturers, who are amongst the biggest electricity users in the state,” said Jamie Karl of Ohio Manufacturers Association. “It will carry a heavy financial burden and makes Ohio less competitive for manufacturing and other business activity,”.
Karl is also concerned the Clean Air Program will change Ohio’s energy market.
“We are moving away from free-market principals and deregulation,” Karl said. “And back toward a system in which the state picks winners and losers.”
Wilkin argues the Clean Air Program is important for producing jobs as well as preserving Ohio as a generator of energy rather than an exporter.
“There are direct and indirect jobs, around 7000 or more coming from the project,” Wilkin said. “Also, a lot of the credits that were being bought were being bought for farms out of state, so the energy created from the wind plants that you bought credits for is not producing energy for Ohio.”
Karl explains that the renewable energy market was growing jobs and this bill has the potential to kill small business owners.
“Ohio’s renewable energy job market has only been growing so it’s only killing job opportunities,” said Karl.
Renewable energy has in fact been growing in jobs, energy efficiency jobs grew 4.5% in the last year according to Clean Jobs Ohio.
Environmentalists are also concerned about the Clean Air Program, the Ohio chapter of Sierra Club cites the reverting of renewable funding to nuclear plant bailouts as their main reason for opposition. In the opposition statement on their website the Ohio Sierra club writes:
“Ohio needs an energy agenda that reduces carbon emissions through reliable investments in energy efficiency programs, ramping up wind and solar projects across the state, and investing in communities and workers being left behind by corporate polluters.”
According to Cuyahoga Valley National Park’s website, the air quality has frequently been in violation of federal EPA standards, most likely due to heavy industrialization to the north and south of the park.
The park released several ozone alerts over summer months and is beginning to conduct more detailed research on the effects of air pollution on several atmosphere sensitive plant species.
Wilkin states saving the nuclear plants would be detrimental is a federal carbon tax was imposed.
“If things as the national level change and a carbon tax came and we had no source of carbon-free emissions that could be a huge issue for us,” Wilkin said. “Once you lose them they’re gone.”
FirstEnergy’s Perspective
Ohio was moving in a direction to make the state more energy efficient but House Bill 6 stopped any long term plans for Ohio to have a long term energy plan. House Bill 6 reduced the Renewable Portfolio Standard and Energy Efficiency Resource Standard. This has people and companies against the bill calling it the “Nuclear Bailout Bill” because anyone under FirstEnergy or AEP Electric company bills will have to pay 85 cents extra on their monthly electric bill. Over a course of a year this up-charge on electric bills will give Nuclear power plants close to 200 million a year.
Now the question with House Bill 6 being in place is how is Ohio going to be sustainable with renewables going out? We know companies will do whatever they can to make the most money. “FirstEnergy is not trying to move away from nonrenewable resources.” said, Will Singer, communications representative for FirstEnergy. With this being the case there must not be a lot of money out in the renewable market or FirstEnergy would be pushing to use those more.
With House Bill 6 getting passed there will be environmental effects. For starters we know renewable energy reduces our carbon footprint and with the bill getting passed our footprint will become larger. This will in turn impact the climate negatively by destroying more ecosystems, polluting air, water and land, and also heats up the planet through the greenhouse effect. There are some ways we can reduce our carbon footprint.
“The biggest carbon emitting thing we do everyday is driving. It’s a bit more expensive but hybrid or electric cars would be something that we could do personally [as citizens] to reduce carbon footprints.” said Singer. There are also other alternative options such as public transportation and carpooling to reduce carbon emission. There are many things to consider doing so we as citizens can slow down the destruction of the Earth since nuclear plants and electric companies are able to destroy it at an increasing rate. Climate change is real and we the people need to do everything in our power to stop it.
There will be economical effects to go along with House Bill 6 too. As stated already consumer prices will go up on their electric bills. Customers may be saving $1.39 each month without House Bill 6 however it will cut the energy efficiency savings that saved Ohioans 1.4%
Zach McKnight: Infographics (bar graph, time graph), story editing
Issiah Eaton: Video, First Energy written story
Colleen Carroll: First Written story, data analysis map
