Today, First Energy announced that it is cancelling the conversion from coal to biomass of units 4 and 5 of its R.E. Burger Plant in Shadyside, Ohio and shutting the units down. What might sound like a setback for renewable energy is actually a good thing for the renewable energy industry and FirstEnergy’s customers. To comply with Ohio’s renewable energy standard, other Ohio utilities have been inking long-term power purchase agreements with wind, solar, and landfill gas energy developers that have clear environmental and health benefits. Instead of embracing this strategy, FirstEnergy went to the legislature and got an amendment to last year’s budget that gave them “bonus” – or bogus – renewable energy credits (RECs) when Burger operated principally with biomass. (NRDC worked with our allies in Ohio to make sure this bonus was minimized.)
Leaving aside the questionable environmental benefits of burning woody biomass for electricity, Burger’s bogus RECs would have distorted the market for renewable energy in Ohio by decreasing the value of RECs from Ohio-based wind and landfill gas facilities. Customers would have paid a long-term price for Burger’s operation because FirstEnergy – alone among Ohio’s electric utilities – would not be transitioning to clean energy sources. Instead, FirstEnergy’s strategy was to get partway there with creative accounting. Hopefully, FirstEnergy will develop a renewable energy strategy focused on wind and solar projects that help advance Ohio’s economy and improve the environment. Congratulations to the Ohio Environmental Council, Sierra Club, Buckeye Forest Council, Ohio Consumers’ Counsel, and other groups who worked to make FirstEnergy’s “creative accounting” strategy a failure.