House Bill 6 Repeal Means Cash Back for Some
Back in December, we warned that House Bill 6 could bring you higher electric rates. House Bill 6, or the “Ohio Clean Air Program”, included bailouts for two nuclear power plants then owned by First Energy. Since then, allegations of racketeering, bribery, and corruption have cast a shadow on the law. Now, the newly passed House Bill 128 has repealed part of that law including a decoupling provision. The repeal comes after First Energy announced refunds to their customers.
What Is Decoupling?
Apart from the fees for the two nuclear power plants, House Bill 6 also included a “decoupling” provision. This section provided First Energy with a yearly income and a way to make back lost income from energy-efficiency programs. Decoupling is a common way for utilities to make up some lost income. However, House Bill 6 helped First Energy make more money in 2018 than in other recent years. About $355 million, in fact.
As a result, First Energy utilities, Toledo Edison, Ohio Edison, and The Illuminating Company charged customers higher rates than all other utilities in Ohio. What’s more is that House Bill 6 set these payments to last through 2024. That means First Energy could have made an estimated $978 million each year.
How Much House Bill 6 Remains?
The monthly utility bill fees to support First Energy’s two nuclear plants went to a “Nuclear Energy Resource Fund”. The fund would have collected $150 million annually until the end of 2027. After the corruption scandal, Ohio passed House Bill 128 in March to scrap much of that 2019 law. However, several provisions from that law remain in force. These include the Ohio Clean Air Program and the Solar Energy Credit Fund to help expand solar energy in Ohio.
Who Gets Refunds?
First Energy stated in its press release that it would “collectively credit customers” for the funds it collected. All told, that adds up to $26 million from about 2 million of its utility customers. Unfortunately, First Energy has not announced the refund amount. A rough calculation suggests that each of its customers could get approximately $13. The company has not said when customers will see it.
What Does This Mean For The Rest Of Ohio?
Decoupling isn’t a new idea for Ohio, or First Energy. With House Bill 6 fading, Ohioans will still need to find the best way to maintain the state’s grid. In light of the Solar Fund, it should come alongside greener options. If you want to stay on top of the news about Ohio electricity, find new options for your electricity plans, or ind out how to keep your electricity bill low, check out www.ohenergyratings.com