Pew Reports Downturn in Ohio's Clean Energy Economy, But There's Hope for the Future


Yet more proof--if proof were needed--of the massive error that Ohio made last year in freezing its clean energy standards: a report from Pew Charitable Trusts released last week documents the disappointing downturn the state's clean energy sector is facing in the wake of the freeze.

The research predicts that installations and revenue in some sectors--particularly wind--will falter, with many investors now choosing to direct their money elsewhere. The report also notes that many projects and contracts already underway are currently experiencing problems.

In June 2014, Ohio passed SB 310 which froze its wildly successful renewable energy and energy efficiency standards for the next two years while a legislative study committee was convened to "review costs." As opponents of the freeze made clear at the time, and as the Pew study now (unfortunately) documents, it could spell disaster for Ohio's renewables industry--and its environmental credentials.

The Buckeye State has been flying high with steady growth in clean energy since the standards went into effect in 2009. As recently as 2013, Ohio was leading the country in the number of facilities manufacturing components for wind technology and second in the number of solar equipment providers. The Pew study shows that Ohio attracted $1.3 billion in private clean energy investment from 2009 to 2013 and was predicted to generate an additional $3 billion over the next ten years.

But since the freeze, things have been less rosy.

Wind power installations, which previously totalled 420 MW in capacity and had attracted $755 million in investment, are faltering. Investors are putting their money elsewhere in the face of policy uncertainty at the Ohio statehouse.

And the situation was only exacerbated by the 2014 passage of another law which requires wind projects to maintain wider setbacks from property lines, effectively tightening the areas in which commercial-scale installations can be made. According to Pew, Ohio has sufficient wind resources to support 54 gigawatts of capacity--enough to meet nearly all of the state's current electricity demand. To be unable to exploit that potential because of short term politicking is a disappointing waste of potential at a time when supporting clean energy and fostering carbon reduction should be high on the policy maker agenda.

Ohio has also seen potential for solar investment damaged in the wake of the freeze. In 2012, Ohio attracted $187.4 million in private investment for solar power, ranking it 12th nationally. But the state fell from that position in 2013 to 20th place ($75.3 million) amid uncertainty over the future of the standards. Solar installations are now expected to total 30 MW and 32 MW in 2014 and 2015 respectively, down from the 2012 height of 48.3 MW.

Energy efficiency has been another casualty of SB 310.

Manufacturing accounts for one third of Ohio's total energy consumption and the state ranks sixth in the nation for industrial energy consumption. Technologies such as combined heat and power (where electricity and heat are generated from a single source), or waste heat to power (which captures heat from industrial processes and uses it to generate electricity), have the potential to reach 6 GW of installed capacity--more than any other state in the Midwest. But following the 2014 freeze, and a last-minute addition to SB 310 that allows large industrial opt-out from utility-sponsored efficiency programs, Pew reports less incentive for industry to invest.

It is ironic that this discussion is happening now--just as Ohio is preparing to roll up its sleeves and iron out its plan for meeting U.S. EPA's pending rules to cut carbon pollution from power plants. We already know that renewables and energy efficiency will play a central role in that plan, as clean energy has the potential to get Ohio far down the road for meeting the carbon targets. But hampering the the clean energy industry with regressive, short sighted decisions at this point in time--with the final carbon rules set to be issued later this summer--only puts Ohio behind when it should be moving forward.

As we move into this 2015 legislative session, Ohio's policymakers now have an important decision to make.

They can replicate the mistakes of 2014 and bow to a small set of special interests that benefit from holding Ohio back from diversifying its energy resources and decarbonizing its grid.

Or, they can choose to answer the call of Ohioans to capitalize on the energy efficiency and renewables opportunities that began in 2009. States such as Michigan and Iowa are proving that it is possible to shift to clean energy while meeting energy needs reliably, saving consumers money, and protecting the environment.

This can be done in Ohio too.

Just last month, a wide spectrum of businesses, hospitals, trade associations, and universities convened in Cleveland for the first stop of the Ohio's Energy Future Tour, and made clear that despite the setbacks of 2014, many are still striving to ensure that the state's clean energy economy recovers. Indeed, Ohioans are ready to be part of the transition from fossil fuels to clean, renewable energy and to benefit from the job creation, cost saving, and environmental improvements that come from embracing progress.


It is time to get the state back on track and to ensure that the recent downturn reported by Pew is just an anomaly on the long, robust future of clean energy in Ohio. Let's make 2015 that year.