Part of NRDC's Year-End Series Reviewing 2017 Energy & Climate Developments
This month marks the one-year anniversary of an event in Ohio that turned the page on years of political machinations and ideological theatrics around with the state’s growing clean energy industry—Governor Kasich vetoed a bill that would have weakened successful clean energy standards that had been “frozen” by the Ohio legislature back in 2014.
With the stroke of a pen, the Governor’s action signaled to the growing number of consumers and businesses that want clean energy that they can find it in Ohio, not just in Michigan and Illinois, two neighboring states led by Republican governors that are also marking one-year anniversaries this month of upping the ante on their own clean energy standards.
But where does Ohio stand on clean energy policy today, as we near the close of 2017?
In this year of upheaval of our federal environmental laws—not to mention months of overt cronyism at the highest levels of government to salvage the failing fossil fuel industry (read: Ricky Perry’s proposed massive, damaging bailout of our nation’s coal and nuclear plants)—Ohio remains at the center of these controversies given its historic reliance on coal. Clean energy is trying to make a comeback following Kasich’s veto, but uncertainty over the state’s energy policy landscape remains, chipping away at corporate confidence that Ohio is a good place to develop the next wave of renewable energy projects.
Here’s an inventory of the distance we’ve traveled in the last year on realizing Ohio’s clean energy future, and how much further we have to go:
Coal and Nuclear Bailouts
Ohio has been the eye of the storm on a national debate around the fate of coal and nuclear plants that can no longer compete in today’s energy market of rock-bottom natural gas prices, flattening electricity demand, and abundant (and increasingly cheap) wind, solar and energy efficiency.
More than a decade ago, Ohio’s utilities and lawmakers made the call to restructure the state’s energy markets, spinning off power generation from the poles-and-wires utilities and forcing all power plants to sink or swim in a competitive landscape while ensuring customers would reap the benefits of lower energy prices. The getting was good for a while for coal and nuclear plants, but in recent years power prices have dropped precipitously due to a glut of natural gas generation, spelling trouble for the more expensive sources.
That brings us to this year’s state legislative session, in which all of Ohio's major electric utilities have tried their hand at sticking consumers with the bill for their own poor financial decisions. The first of those attempts was to bail out the two Eisenhower-era coal plants under the Ohio Valley Electric Corporation (OVEC) umbrella. FirstEnergy pursued similar subsidies for its two failing nuclear plants this year.
Thankfully, these efforts appear to have stalled for the time being, despite some attempts to rebrand them as “national security” efforts and necessary for maintaining Ohio’s economic viability. The fact that these bills failed to move at a time of sustained pressure on lawmakers, and assurances from bill sponsors early in the year that passage was essentially a “done deal,” demonstrate just how transparent a fleecing of consumers these bailouts are.
Wind Setback Fix
This last year also saw multiple efforts to undo an anti-business bill from 2014 that nearly tripled the setback distance for wind turbines from property lines, effectively zoning out commercial-scale development in Ohio.
2017 marked a glimmer of hope to press reset on those ill-advised setbacks. After several fits and starts in prior years, three separate bills were introduced this year to right the ship on wind development, culminating most recently in December with Senator Matt Dolan's (R) Senate Bill 238. It would ease restrictions while taking advantage of existing authority in the Ohio tax code for local county governments to negotiate property taxes and jump-start stalled development projects.
One thing is for sure, these policy fixes need to happen now if Ohio hopes to attract corporate investors who are increasingly focusing on state clean energy laws when deciding where to funnel their dollars in today’s highly competitive environment.
Clean Energy Standards and Economy
Last but not least is Ohio’s broader renewable energy and energy efficiency policy, which was reinstated on January 1, 2017 following Kasich’s veto. With those requirements back in place, Ohio’s energy efficiency programs—which have saved consumers over $1B to date—and the state’s renewable energy law continue to push the state’s energy landscape forward.
Earlier this year, Environmental Entrepreneurs (E2) reported that Ohio is home to more than 100,000 clean energy jobs, many in energy efficiency. Ohio is also second in the Midwest for renewable energy jobs. Examples of that leadership are in evidence all across the state, as utilities and third party companies embark on solar and wind projects to satisfy increasing customer interest in meeting energy demand from clean sources—from the Vinton, Hardin and Brown County solar developments, to General Motors’ announcement to power four of its Ohio plants with 100% clean energy by the end of 2018, to the LEEDCo offshore wind project proposed for Lake Erie.
But it is clear that more needs to be done to ensure Ohio catches the wave of clean energy development sweeping across neighboring states. It doesn’t help corporate investor confidence that Ohio’s legislature has devoted the better part of four years to various attempts to water down, freeze, or make voluntary the state’s energy efficiency and renewable energy standards. And this last Spring, the Ohio House passed yet another bill (HB 114) to upend Ohio’s recently-reinstated clean energy standards, which the Senate may take up (reportedly with more clean energy-favorable provisions) in early 2018.
All of this is context for the E2 jobs report finding that, while Ohio has a leadership role in the region on renewables, the state has seen slower growth in this area than several of its neighbors. So, imagine what Ohio could accomplish if we only righted the ship.
The Road Ahead
Governor Kasich saw the state’s opportunity barely a year ago when he wielded his veto pen. He recognized that moving Ohio backward on clean energy would undermine the state’s progress, particularly the “very options most prized by companies poised to create many jobs in Ohio in the coming years.”
He also saw the opportunities for the Ohio workforce, and the damage that could be done by turning away from the realities of where the energy sector is moving: “Ohio workers cannot afford to take a step backward from the economic gains that we have made in recent years . . . and arbitrarily limiting Ohio’s energy generation options amounts to self-inflicted damage to both our state’s near- and long-term economic competitiveness.”
Imagine if Governor Kasich’s vision of last year was made a reality. That is the direction Ohio needs to take a year after his historic veto, a vision that we intend to pursue in 2018 and beyond.