Ohio governor signs bill freezing renewable-energy standards


Ohio governor was heavily lobbied by state Chamber of Commerce, utilities and conservative activists. (Gary Landers/AP)

Ohio Gov. John Kasich (R) dashed the hopes of environmentalists, leading manufacturers and renewable-energy businesses Friday and signed a bill shelving requirements for utilities to ramp up the use of renewable energy and energy efficiency.

Ohio has been a battleground over whether to roll back 2008 legislation requiring the state to acquire 12.5 percent of its energy portfolio from renewables and to reduce energy consumption by 22 percent by 2025.

The Ohio Chamber of Commerce, the utility First Energy and the American Legislative Exchange Council pushed to roll back the standards. On the other side, 51 manufacturers, including Owens-Corning, Whirlpool, Honeywell and Honda, signed a letter urging Kasich to let the requirements stand.

Supporters of the standards hoped that Kasich — who has praised the Ohio jobs generated by the renewable-energy industry and backed tough regulations on fracking chemicals and gas leaks — would veto the state legislature’s bill freezing and reevaluating the standards. Instead, he signed it in private; as of early evening, he had issued no statement.

Kasich is running for reelection this year.

“In the past we’ve been very pleased with our ability to work with the governor and with his leadership on natural gas regulations,” said Cheryl Roberto, associate vice president for clean energy at the Environmental Defense Fund. “So we are very disappointed because we can’t see the bill as anything but a step backwards.”

EDF said that the legislation has created 25,000 jobs in the renewable industry and through energy efficiency has saved Ohio ratepayers $1 billion.

Scott Segal, a lobbyist with Bracewell & Giuliani representing utility interests, said that the renewable standards would drive up electricity costs that would “fall disproportionately” on Ohio’s poor.

“We are pleased that Governor Kasich signed SB 310, protecting Ohio’s consumers and business owners from higher energy prices,” said Eli Miller, the Ohio state director for Americans for Prosperity, the group backed in part by conservative billionaires David and Charles Koch. “These standards have proven to be unrealistic. Governor Kasich has done the right thing by providing a temporary freeze to these standards so that the economic well-being of our working families and businesses can be factored in before moving forward.”

But environmental groups said that the study group created to reevaluate the standards would end up gutting them.

“We continue to support renewable energy,” said Tammy Ridout, a spokeswoman for American Electric Power, the giant Ohio-based utility. “But a lot has changed in Ohio since those requirements were put in place in 2008, so we think it makes sense to freeze the current mandates while the state takes the time to evaluate what should be done.”

Ridout said that AEP would maintain its energy-efficiency plan and file for an extension of that plan this year. It has also signed power purchase agreements to buy renewable energy that will remain in effect. But the study committee the new bill creates can reevaluate whether AEP and others can charge ratepayers for such investments.

The new proposed regulations the Environmental Protection Agency issued this month for carbon dioxide emissions from existing coal plants could make the state’s own renewable standards less critical. To meet the EPA targets, states will have to rely heavily on energy efficiency and renewables.

“I don’t think it will be long before the state revisits these decisions,” said Samantha Williams, a staff attorney at the Natural Resources Defense Council’s Chicago office. “Energy efficiency and renewable energy are the biggest tools in cost-effectively reaching the EPA’s new carbon pollution goals.”

Williams added that “once decision-makers digest the new clean power plan, they are going to have to reopen the toolbox that this law essentially shuts.”

Steven Mufson covers energy and other financial news.
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