{"id":505,"date":"2019-05-31T16:09:48","date_gmt":"2019-05-31T21:09:48","guid":{"rendered":"http:\/\/www.ohenergyratings.com\/blog\/?p=505"},"modified":"2021-05-03T11:39:55","modified_gmt":"2021-05-03T16:39:55","slug":"ohio-electricity-customers-pay-more-hb6","status":"publish","type":"post","link":"https:\/\/www.ohenergyratings.com\/blog\/ohio-electricity-customers-pay-more-hb6\/","title":{"rendered":"Ohio Electricity Customers to Pay More for HB6?"},"content":{"rendered":"
\"Ohio's
HB6, the “Ohio Clean Air Program”, might lower Ohio electricity bills by $3.39. But how much will Ohio energy consumers ultimately be forced to pay?<\/em><\/center><\/figcaption><\/figure>\n

Electricity Bill Generating Worry for Ohio Renewables<\/h2>\n
\n

Generating company First Energy Solutions is in the midst of Chapter 11 reorganization. The company told state lawmakers that if doesn’t find a buyer for both\u00a0Ohio nuclear plants<\/a> or a way for them to generate a profit within Ohio\u2019s competitive electricity market it will start closing them in 2020.<\/p>\n

Ohio House Bill 6<\/a>, \u201cOhio Clean Air Program\u201d,was originally designed to incentivize reduced\/zero carbon output from power plants by creating the Ohio Clean Air Program. The program would incentivize generator companies to build power plants with reduced\/zero carbon output. Ideally, that all would lead to less pollution, better air quality, less green house gasses affecting climate, and\u00a0cheap Ohio electric rates<\/a>.<\/p>\n

But since the beginning, the devil has been in the details.<\/p>\n

Ohio Renewable Energy Price<\/h3>\n

HB6 originally created an annual fund of $300 million that would benefit carbon dioxide-free electric generators. Carbon-free generators could get a $9 credit per megawatt hour for the electricity they generate.\u00a0 First Energy\u2019s Davis-Besse and Perry nuclear power stations were expected to qualify for at least half of a $300 million fund and continue to employ about\u00a01,400 people in Oak Harbor and Perry, Ohio. Wind and solar projects around the state would have naturally shared in the $9 credit per megawatt hour. However, this credit would only come about by eliminating a $4.39 per month fee that currently funds energy efficiency and renewable energy programs that have saved Ohio utility customers\u00a0$5.1 billion on utility bills <\/a>\u00a0since 2009.<\/p>\n

Nuclear plants must pay million of dollars for \u00a0fuel rods at refueling time.\u00a0Perry nuclear power station has already completed its 27 day refueling shut down. However,\u00a0Davis-Besse<\/a> is scheduled for refueling in 2020. Consequently, First Energy Solutions would really like a\u00a0decision about HB6<\/a> soon so it can begin planning to buy new fuel rods for Davis-Besse by June.<\/p>\n

That behooved House Republicans to get the bill to Governor Mike DeWine’s desk in time.<\/p>\n

Ohio Apples to Apples Cost<\/h3>\n

Unfortunately, the two parties stayed split over support for the state\u2019s renewable energy standards<\/a>. Davis-Besse and Perry make up roughly 2,150 MW (about 12%) of the state\u2019s\u00a0utility-scale net electricity generation<\/a>. Renewable energy in Ohio<\/a> contributes around 3.2%. However, the state\u2019s present renewable energy portfolio standard<\/a> requires renewable sources to generate 12.5% by 2027. So local utilities are supposed to purchase renewable energy to meet that goal. Renewable energy standard backers worry that utilities will no longer need to follow renewable energy compliance rules<\/a>. As a result, Ohio may see slower development and job growth in its renewable energy sector. One 2018 research project suggested Ohio could see 10,500 jobs created through investments in\u00a0wind and solar power<\/a> along with energy efficiency.<\/p>\n

Those who backed HB6 argued that closing the nuclear plants would increase carbon emissions<\/a> as more natural gas generators took over the load.\u00a0 Carbon emission debates have split environmental groups over nuclear power station closures in both Ohio and Pennsylvania. Natural gas generators are far more profitable in competitive markets. They are cheaper to operate, respond faster to changing demand, and more economical to build. While they are cleaner than coal plants, natural gas plants still put out lots of carbon.<\/p>\n

Governor Mike DeWine<\/a> came out in support of saving the nuclear plants, saying, \u201cYou cannot dramatically reduce carbon or keep those numbers down without using nuclear.”<\/p>\n

Electric Bill Down to the Wire, Poles Apart<\/h3>\n

Both parties struggled with negotiations. Republicans argued the bill ensured low priced Ohio electricity<\/a> and protected jobs. The Democrats argued the bill is a bail out<\/a> that would cripple the growing Ohio renewable energy job sector and increase customer prices.<\/p>\n

On May 22, Republicans on the House Energy and Natural Resources Committee<\/a> stripped out the renewable energy portfolio standard from the bill all together. Ironically, they added subsidies for two 1950s-era coal-fired power plants<\/a> that will last until 2030. Ohio Valley Electric (OVEC) owns both coal-fired plants. OVEC is in turn owned by several of the state\u2019s major utilities.<\/p>\n

On May 29, the Ohio House passed HB6<\/a>, the \u201cOhio Clean Air Program\u201d by 53- 43 with a handful of Democrats voting for it and nearly the same number of Republicans voting against it. The bill now goes to the Senate.<\/p>\n

Future Electricity Rates in Ohio?<\/h3>\n

HB 6 demonstrates the challenges in crafting an energy program for Ohio. The state needs a program that addresses both the demand for affordable energy and problems from increasing carbon emissions.<\/p>\n

In its current form, all Ohio electricity customers will pay $1 on their monthly utility bill. The money will go into a state \u201cclean air fund\u201d worth about $190 million annually. Six current solar projects will receive some subsidy. However, most of the money would go to the Davis-Besse and Perry nuclear plants until 2026.\u00a0 Meanwhile, OVEC could charge its customers $2.50<\/a> per month to keep the two coal plants operating, one of which is located in Indiana. In addition, the bill also allows residents of unincorporated areas to demand a referendum to block construction<\/a> of wind farm projects in their area, even if the project has already begun.<\/p>\n

Your Ohio Energy Bill<\/h3>\n

Adopting HB6 would replace the $4.39 per month renewable energy fee with a $1 subsidy surcharge for the nuclear plants. While that sounds like Ohioans can look forward to lower utility bills, it\u2019s not certain. The bill\u2019s amendments permit blocking of existing wind projects as well the repealing of the renewable energy portfolio standard and these could stifle renewable energy in Ohio<\/a>. \u00a0Unmet demand could possibly lead to higher prices in the near future. Higher prices would trigger a cap on subsidies to the nuclear plants. Higher prices would also lure more cheap-to-build natural gas generation plants into the state. In the end, the \u201cOhio Clean Air Program\u201d might wind up increasing both consumer prices and carbon emissions.<\/p>\n

HB6 is a very thorny proposal. It\u2019s not entirely clear what will happen to Ohio electric rates if it is signed into law. As the measure currently stands, consumers and\u00a0Ohio electricity companies<\/a> may see benefits in some areas but also may face losses in others. What is really at stake is how Ohio will keep electricity prices affordable while reducing carbon emissions for the future.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Electricity Bill Generating Worry for Ohio Renewables Generating company First Energy Solutions […]<\/p>\n","protected":false},"author":8,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_mbp_gutenberg_autopost":false},"categories":[9,48,41,44,45,46,42,47,50],"tags":[36],"_links":{"self":[{"href":"https:\/\/www.ohenergyratings.com\/blog\/wp-json\/wp\/v2\/posts\/505"}],"collection":[{"href":"https:\/\/www.ohenergyratings.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.ohenergyratings.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.ohenergyratings.com\/blog\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/www.ohenergyratings.com\/blog\/wp-json\/wp\/v2\/comments?post=505"}],"version-history":[{"count":8,"href":"https:\/\/www.ohenergyratings.com\/blog\/wp-json\/wp\/v2\/posts\/505\/revisions"}],"predecessor-version":[{"id":1341,"href":"https:\/\/www.ohenergyratings.com\/blog\/wp-json\/wp\/v2\/posts\/505\/revisions\/1341"}],"wp:attachment":[{"href":"https:\/\/www.ohenergyratings.com\/blog\/wp-json\/wp\/v2\/media?parent=505"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.ohenergyratings.com\/blog\/wp-json\/wp\/v2\/categories?post=505"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.ohenergyratings.com\/blog\/wp-json\/wp\/v2\/tags?post=505"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}