Five years after Gov. Mike DeWine signed House Bill 6 into law, Ohio citizens and ratepayers are still paying the price. 

Ohio lawmakers still haven’t taken steps to repeal the rest of the nuclear and coal bailout bill, which is the focus of what prosecutors say was a roughly $60 million bribery scheme by utility FirstEnergy and its affiliates. Cases continue to wind through the courts, and two men implicated in the scandal have apparently taken their own lives. 

“It’s been really painful, and we’re still living with the consequences of House Bill 6,” said Catherine Turcer, executive director of Common Cause Ohio.

Shepherded by former Ohio House Speaker Larry Householder, the bill swept through the legislature in 2019, passing just 3 and a half months after its first introduction and despite massive opposition from consumer advocates, environmental groups, renewable energy interests and others.

The law called for more than $1 billion in subsidies for two nuclear plants for which FirstEnergy had been seeking bailouts since 2014. Additional provisions included subsidies for two 1950s-era coal plants known as the OVEC plants, along with gutting of the state’s renewable energy and energy efficiency standards. A referendum effort that would have let voters reject the law under Ohio’s constitution was ultimately thwarted amid claims of misleading ads, harassment of signature collectors and other problems.

One year after the bill passed, federal agents arrested Householder and others on charges under the Racketeer Influenced and Corrupt Organizations Act, known as RICO. The complaint outlined a $60 million criminal enterprise scheme funded by dark money, most of which came from FirstEnergy or its affiliates — roughly four times as much as the Energy News Network and Eye on Ohio had been able to track before the arrests.

Sam Randazzo resigned his position as chair of the Public Utilities Commission of Ohio months later, following an FBI raid on his home in November 2020. In July 2021, FirstEnergy entered into a deferred prosecution agreement with the Department of Justice, admitting it had bribed Householder and Randazzo.

Neil Clark, a lobbyist indicted in the scandal, apparently committed suicide in Florida in March 2021. Randazzo did the same in a Columbus warehouse he owned in April of this year, as he faced indictments on both federal and state criminal charges, along with loss of his license to practice law.

Calls for a full repeal of HB 6 came immediately after the 2020 arrests, but languished for months. Months after the next election, lawmakers finally repealed the law’s nuclear subsidies and a provision for guaranteed utility revenue, but left the rest of the law intact.

Bills to repeal the coal plant subsidies still have not gotten a full vote, and the state’s clean energy standards remain gutted. And full information about the corruption scandal has yet to come out, including answers to questions about Gov. Mike DeWine’s and Lt. Gov. Jon Husted’s involvement.

“The legislature hasn’t done anything to create greater transparency, to address dark money, to ensure we aren’t ripped off,” Turcer said.

“There’s this interesting intersection of dark money and gerrymandering and general decision-making and accountability at the statehouse,” Turcer continued.

Dark money refers to political spending that can’t be readily traced, and gerrymandering is the drawing of voting districts to advantage one political party over another. Together, both can undermine democracy and have delayed progress on climate change.

Still subsidizing coal

“The fact that we’re still bailing out the coal plants is just insane to me,” said Neil Waggoner, Midwest campaign manager for the Sierra Club’s Beyond Coal program. The Kyger Creek plant is in Cheshire, Ohio, and the Clifty Creek plant is in Madison, Indiana. Both plants consistently lose money.

“Those coal subsidies are costing consumers $500,000 per day,” said Ohio Consumers’ Counsel Maureen Willis. Her office estimates Ohioans have paid more than $330 million since January 2020. RunnerStone, a consultant for the Ohio Manufacturers’ Association Energy Group, projects the HB 6 coal subsidies could reach $1 billion by 2030.

The utilities that own the plants defend their continued operation.

“Customers in Ohio receive electricity from OVEC for what it costs to produce it and the funds are used to pay down debt with no proceeds going to shareholders,” said Scott Blake, a spokesperson for American Electric Power, which owns the largest share of OVEC, with other utilities inside and outside ofn Ohio owning shares. More than 500 employees work to make sure the plants operate as efficiently as possible, he added.

Since 1999, however, Ohio law has generally let consumers choose their electricity supplier. “And recent testimony by Duke executive [Amy] Spiller confirms the coal plants will continue to operate even if the subsidy ends,” Willis said.

The question comes down to whether the companies that made bad business decisions to keep noncompetitive plants running should pay their expenses, “as opposed to the public eating the cost,” Waggoner said.

Higher bills

HB 6 not only added subsidies to consumers’ electric bills. It also axed clean energy standards whose net savings for Ohioans had been about $9 per month.

“The elimination of the energy efficiency programs never made sense because they helped customers reduce their electricity usage,” said Rob Kelter, an attorney with the Environmental Law & Policy Center. “They lowered their bills. And they reduced pollution.”

Yet a legislative analysis claimed cutting those programs to pass HB 6 could save Ohioans’ money, a position that was further buttressed by testimony from then-PUCO chair Randazzo. Those arguments left out customers’ savings from avoiding wasted energy and lower overall capacity costs, Kelter said.

A bill to allow some permissive energy efficiency programs finally passed in the Ohio House last month, but passage in the state Senate isn’t guaranteed.

Regulatory scrutiny

Randazzo not only played a key role in shaping HB 6 and getting it passed. He also shaped the PUCO’s piecemeal response after Householder and others were arrested. That approach has continued, even after criminal charges were brought against Randazzo in federal and state court.

“Even after the revelations of what former PUCO Chair Sam Randazzo did for FirstEnergy in the halls of the PUCO, the agency itself has not had to answer to the public,” Willis said. “Case decisions issued while the former Chair led the agency have not been examined.”

“Why has there not been a management audit at the commission?” asked Ashley Brown, a former PUCO commissioner who subsequently headed the Harvard Electricity Policy Group. “Something clearly went wrong. We know that the chairman was bribed. We know that the other people went along.”

Agency spokesperson Brittany Waugaman noted the PUCO has four ongoing investigations in cases relating to FirstEnergy, but did not respond to questions about whether regulators plan to conduct an internal review of its own operations or otherwise review decisions in which Randazzo had participated.

Moreover, “the PUCO too often has made it difficult to get to answers for consumers,” Willis said. “Adverse discovery rulings, unrealistic case schedules, and limited audits, are a few of the problems for consumers.”

Who else?

The federal Department of Justice asked for three delays in discovery for the state regulatory cases, but after the initial 2020 arrests Randazzo was the only additional individual to face federal criminal charges, and he is now deceased. Meanwhile, Ohioans remained on the hook for charges. So in Brown’s view, the delays made sure consumers continued to be victimized by the crime.

The state did file criminal charges earlier this year against former FirstEnergy executives Chuck Jones and Mike Dowling, along with Randazzo and companies he controlled, as well as Householder. Company lawyers previously identified Jones and Dowling as having paid the bribes behind HB 6. But it remains unclear whether they or others will ever face federal criminal charges, said Dave Anderson, policy and communications manager for the Energy and Policy Institute.

Anderson and others also have questions about the involvement of American Electric Power, which paid $900,000 to dark money groups that supported HB 6.

Blake, the AEP spokesperson, said “management does not believe that AEP was involved in any wrongful conduct in connection with the passage of HB 6.” 

Anderson rejects that notion.

“While AEP has not been charged with any crime in connection with HB 6, disturbing new details about the financial relationship between Householder and the utility emerged during the convicted former Ohio House Speaker’s trial last year,” Anderson responded. And the company also has acknowledged it may face civil penalties from a SEC investigation, he added.

“I don’t how AEP defines wrongdoing, but common sense should tell AEP’s customers and regulators that something stinks here,” Anderson said. “AEP owes ratepayers answers, and unfortunately the PUCO has completely failed to investigate AEP’s role in the HB 6 scandal.”

Some bright spots

As consumers continue to face consequences from HB 6, so do Householder and lobbyist Matt Borges, Turcer said. Both are in federal prison while they appeal their criminal convictions in federal court from last year.

FirstEnergy might have to allow some credits or pay penalties as a result of the four pending PUCO cases, Anderson noted. That would be in addition to a $230 million penalty paid to the federal government and class action settlements in a few court cases.

Quarterly reporting requirements under the deferred prosecution agreement of donations to nonprofit groups also may have reined in some of FirstEnergy’s political influence in Ohio, Anderson said. FirstEnergy spokesperson Jennifer Young said the company plans to continue reporting donations, even after the deferred prosecution agreement’s term ends.

Young also highlighted other company reforms including enhanced controls, separation of functions for its top ethics and legal officers and better transparency to stakeholders.

“Today, FirstEnergy is a different, stronger company with a sound strategy, a highly effective compliance program and a companywide culture of ethics, integrity and accountability,” Young said.

Yet the company’s claims about transparency have fallen short, Willis said. “Lawyered-up FirstEnergy… continues to block efforts to publicly disclose their internal investigation reports produced in the wake of the HB 6 scandal.”

Energy policy

Ohio’s energy policy continues to feel impacts from HB 6 as well.

“It does make me wonder where we would be with renewable energy if HB 6 had been completely repealed, or if there hadn’t been this orchestrated campaign, not just to bail out nuclear plants or subsidize coal plants, but also to diminish our commitment to renewable energy and our funding for renewable energy,” Turcer said. Yet now, “the air we breathe is actually dirtier.”

HB 6 “cast such a long shadow over energy policy in Ohio,” said Tom Bullock, executive director for the Citizens Utility Board of Ohio. The energy industry is going through the greatest change in a century, with technological innovations in how energy is produced and stored, as well as new business models, he noted.

“We need to be thoughtful, so that we can grow industry and keep prices affordable and convert to clean and smart and distributed energy,” Bullock said. Otherwise, “We’ll be the last in the Midwest to get there if the way we make energy policy decisions is based on the wish list from traditional energy interests.”

Consequences continue as bill at center of Ohio utility corruption scandal marks fifth anniversary is an article from Energy News Network, a nonprofit news service covering the clean energy transition. If you would like to support us please make a donation.

Along with new tax breaks for families and businesses in return for investing in clean and more efficient energy, the federal government is for the first time offering support to schools and other nonprofits that make those investments.

“Direct support” payments from the Internal Revenue Service will pay back school districts, churches and other nonprofit organizations for part of what they spend on energy renovations that cut their energy use and replace fossil fuels.

For schools the program represents an opportunity to make energy upgrades that many have had to skimp on, according to Nathan Ugoretz, secretary-treasurer of the Wisconsin Education Association Council.

As state school funding falls behind the rising costs public school districts face, “funding for maintenance and improvements have been put on the chopping block,” Ugoretz said Thursday. School districts across Wisconsin have held referendum votes to raise property taxes to support ongoing expenses.

“This leaves no resources for overhauling outdated electrical systems or investments to cut energy costs,” Ugoretz said.

Ugoretz spoke at Forest Edge Elementary School, a Fitchburg school that has been singled out for its strides in improving energy efficiency. In 2021, the school, after operating for just one year, was recognized as the first Net Zero Energy school in Wisconsin — producing and returning to the power grid as much energy as it used.

The BlueGreen Alliance, an advocacy group that combines the interests of the labor and environmental movements, chose the school Thursday for a presentation on how clean energy and energy efficiency tax credits under the 2022 Inflation Reduction Act are available to more than just taxpayers, whether individuals or businesses.

Direct IRS support that passes those tax credits on to nonprofits will help accelerate the spread of green technology to more users, participants in Thursday’s event said.

“That is a really, really big deal — not only because we get to model for our students what a clean energy economy looks like, but because utility costs for schools are one of the biggest demands on school budgets,” said Kristina Costa, deputy assistant to President Joe Biden for clean energy innovation and implementation. “And when energy costs go up, that leaves fewer resources available for everything else that students need to do.”

Cutting those costs by boosting energy efficiency “frees up those precious dollars to improve our schools and in other ways to enrich our kids’ education,” Costa added.

Spurred by the Inflation Reduction Act, businesses have invested $1.7 billion on clean power projects in Wisconsin through May 2024, according to the White House.

“This is a win, win, win,” said Rep. Mark Pocan (D-Town of Vermont) — for improving education resources, for labor and “more professional job development to have good wages and benefits. Pocan praised the Biden administration for taking  “the high road,” adding, “it’s a win for the environment because ultimately we’re addressing climate change through addressing the rising cost of energy.”

Forest Edge school was built well before the Inflation Reduction Act was signed into law, but as Wisconsin’s first net-zero energy school, “it’s an example of what’s possible for schools across the state,” state Carly Eaton, Wisconsin policy manager for BlueGreen Alliance.

From the start the Oregon School District facility was developed to be as energy efficient and clean-energy focused as possible, school district officials said.

A total of 1,704 solar panels line the flat rooftops of the building, providing enough electricity that the district is able to sell some of it back to the power grid, according to Andy Weiland, Oregon School District business manager. Walls of glass maximize natural light in the building, while the panes are specially treated to darken automatically in sunlight to prevent the building interior from heating up.

Geothermal energy, which draws heat from deep below the earth’s surface,  and heat pump technology warm the school — and also keep it cool when the weather outside is warm.

“For the most part we don’t have to use any fossil fuels at all,” Weiland said as he gave a tour of the building Thursday.

Had the district been able to use the Inflation Reduction Act’s direct support program when it was building the school, the savings, Weiland speculated, “would have been several million dollars.”

Beyond the savings that the act promises for people and organizations that use its incentives to upgrade their energy systems, the legislation has also been championed for provisions that require contractors to pay employees prevailing local wages on projects that qualify for the full values of tax credits. It also requires projects to employ participants in licensed apprenticeship programs.

The two requirements help stabilize the construction workforce, said Emily Pritzkow, executive director of the Wisconsin Building Trades Council, which represents about 40,000 Wisconsin members in several construction unions.

“By utilizing competitive labor standards, including an area’s standard wages, benefits and training opportunities, we are ensuring the economic impact of these projects stays in our local community for generations to come,” Pritzkow said.

Federal clean energy program unlocks benefits for Wisconsin schools is an article from Energy News Network, a nonprofit news service covering the clean energy transition. If you would like to support us please make a donation.

Southeastern Wisconsin and the Chicago area are emerging as major players in the national data center explosion, most notably with Microsoft’s $3.3 billion planned data complex near Racine, Wisconsin.

Clean energy advocates in the region say data centers pose both a risk and an opportunity, as they can put major stress on the grid, prolong the lives of coal plants and spark new natural gas plants, but also facilitate significant renewable energy investment. Wisconsin utility We Energies, for example, cited demand from data centers in its recent requests to the Public Service Commission for 1,300 MW of new gas generation. Microsoft, meanwhile, has promised to build renewables in the state while also likely creating demand for new or continued fossil fuel energy.

The organization Data Center Map shows more than a hundred data centers in the Chicago area and a handful in Southeastern Wisconsin, often located on the site of former coal plants or industrial operations. A data center is underway on the site of the shuttered State Line coal plant just across the border from Chicago in Indiana. The data center developer T5 recently announced plans for four to six data centers totaling 480 MW of capacity and costing as much as $6 billion in the Illinois town of Grayslake near the Wisconsin border, adding to data centers it already runs in the region.  

Virginia has long been known as “Data Center Alley,” with about 70% of global internet traffic passing through its servers, according to the Wall Street Journal. Dominion Energy said that because of data centers, its electricity demand in Virginia could quadruple and represent 40% of total demand in the state over the next 15 years. Georgia and Tennessee have also seen much data center construction and speculation. Utilities like TVA, Duke and Dominion have announced plans to build more gas plants and keep coal plants open longer in that region, along with building renewables.

Meanwhile, some experts say the Great Lakes region is an increasingly promising spot for data centers because of its cooler climate that reduces energy demand and the availability of water.

“There is no better place” for data centers than the Upper Midwest, said Josh Riedy, who helped design North Dakota’s first tier-three data center, referring to a data center with high reliability — on a scale of one to four tiers — that includes multiple power sources. Riedy also founded Thread, a grid maintenance software company that he’s marketing as especially helpful to serve data center demand.

“The Upper Midwest can export data around the globe,” Riedy said. We’re starting to see the tide turn, it’s just natural.”

Growing load

Projections abound regarding the way data centers — including those processing cryptocurrency and running AI applications — will increase energy demand nationally and end an era of stagnant load growth.

Last year, the Federal Energy Regulatory Commission predicted 4.7% load growth over the next five years, up from 2.6% previously estimated for five-year growth. Data centers “supercharged by the rise of artificial intelligence” will require between 9 and 13 more GW of electricity over the next five years, according to seven case studies analyzed in a December 2023 report by the Clean Grid Initiative, which does not include data center estimates for MISO or CAISO (California) regional transmission organizations. A McKinsey & Company report predicted 35 GW of total demand from data centers by 2030.  

Load growth sparked by data centers comes on top of a shift from fossil fuels to electric heating, cooling and transportation. A 2022 report commissioned by Clean Wisconsin and RENEW Wisconsin found load growth could increase to 166% of 2022 levels with building and vehicle electrification needed to meet the state’s goals of net-zero emissions by 2050.

“Everything from data centers to manufacturing to AI to cryptocurrency,” said Sam Dunaiski, executive director of RENEW Wisconsin. “These all could be triggers for new load, and it all could be coming to Wisconsin, though it’s not unique to Wisconsin. Things like solar and battery manufacturing are coming online that ironically need new load growth too. We think the best way to meet that new load both environmentally and economically is through renewables and transmission to go along with it. This is a great opportunity for a low-cost renewable energy boom in the state.”

Along with the generation demand, Riedy noted, come needs for grid updates and resiliency, which can ultimately help the grid as a whole.

“If you’ve built and designed a data center, you know the nature of them is in many ways fundamentally different than most energized structures,” Riedy said. “Walmart, for example, is going to consume power, but it will have peaks, and constant power is important but not in the way it is to a data center. With crypto mining or AI model training, you see machines running at near peak performance around the clock. That’s producing a type of strain on the grid that has few comparisons.”

Microsoft and more

Microsoft’s energy plans — like many details about the massive data project — are not yet clear, and the company’s ambitious climate goals give advocates hope that the company will finance much new renewable generation either on-site or through power purchase agreements. The company has announced it will build a 250 MW solar array in Wisconsin.

But Microsoft will likely also purchase power from We Energies, fueling advocates’ worries about new natural gas generation and rate increases for regular customers.

The data center will be located on the sprawling site between Milwaukee and Chicago that was previously slated for an enormous LCD screen factory by the company Foxconn. That plan was repeatedly scaled back and then scrapped in the face of economic issues and local opposition.

Citizens Utility Board executive director Tom Content noted that “under state law passed for Foxconn, Microsoft is eligible for discounted market-based electricity rates. They would pay basically for the transmission and distribution, but a portion of their rates would just be set at wholesale market rate,” rather than the retail amount customers usually pay.  

In February, a subsidiary of We Energies filed a plan with the Wisconsin Public Service Commission for an estimated $304 million in grid upgrades related to the Microsoft project. Public auditors filed a letter with the commission noting exemptions that allow less oversight because the project is in a special technology zone.

The Microsoft plan was touted by President Joe Biden as an example of reinvigorated Midwestern investment, but it has faced concerns about its energy and water use. Meanwhile Microsoft has faced setbacks globally in reaching its climate goals, in part because of the massive energy demand of artificial intelligence applications.

Cost concerns  

Advocates said utilities may use data centers to justify more investment that earns them a rate of return, even when it is not necessarily needed.

“We are concerned that there could be an overinflation of expected demand in order to capitalize on this trend and build more gas as a last-ditch effort,” said Ciaran Gallagher, energy and air manager for Clean Wisconsin.

“There’s a little bit of a sky-is-falling scenario here,” Dunaiski agreed. “In the early 2000s we saw this with load growth [projections] particularly around the internet. People thought the internet would cause our electricity generation needs to explode. They increased, but there were improvements that came with it — infrastructure getting more efficient, and software.”

That precedent raises questions about the rush to build out gas power to accommodate projected demand.

“Gas isn’t coal, but we shouldn’t be striving for the second worst option, for the environment or for our pocket books,” Dunaiski continued. “If we build these gas plants, customers will be paying for them for the next 20, 30 years.”

Gallagher noted that the EPA’s new rules for gas plants make new gas investments even more questionable.

“All the gas plants proposed in Wisconsin and across the country in relation to this demand from data centers will have to comply with these standards, and by 2032 either run not very often or reduce greenhouse gas emissions by 90% through carbon capture and sequestration or  low-carbon hydrogen,” Gallagher said. “That prompts the question: Is it worth the price tag to build these gas plants that could become stranded assets or have to spend additional money to comply with these rules?”

Using existing renewables or zero-emissions nuclear energy to power data centers can impact customers too. Content noted that this strategy “accomplishes the decarbonization goals for the tech companies and the reliability needs for the data center. But then you’re taking the fully depreciated, mostly paid-off asset on utilities’ books and having it serve one or two customers, and then the utilities will have to backfill that with a combination of natural gas, solar, storage, wind or future nuclear to serve the rest of the customers.”

“It’s on everybody’s mind how we’re going to tackle this in a way that ensures we don’t say no to economic development, but don’t make energy costs unaffordable,” said Content, noting that data centers have been a major topic of discussion among the National Association of State Utility Consumer Advocates – including at the organization’s conference in Madison in June.  

“Different states are trying different approaches,” Content said. “There’s talk of changing the way utility costs are divided up — currently among residential, industrial and commercial — and dividing it up four ways, with data centers becoming their own entity. Tech companies are pouring a lot of money into the development of these things. They have the wherewithal to contribute mightily to these projects.”

Renewable opportunities

Gallagher emphasized that renewable advocates are not opposed to data centers.

“We think data centers and the economic development that they can bring are not at odds with environmental protection and climate mitigation,” she said. “This can be a low-carbon industry but only if new additional renewables are built to supply all or most of their demands. We think that’s viable if renewables are cost-competitive with gas, and pairing renewables with storage can provide the type of reliability these data centers need.”

Riedy sees renewables and gas as a necessary mix to fuel data centers. While renewables’ intermittency might be seen as a barrier, he said renewables actually could have a unique role to play in energizing data centers – especially in the Midwest.

“In the heat of the day you’re delivering, so having alternate [energy] sources to peak-shave and normalize the cost of energizing that equipment is very important,” Riedy said. “It’s leading to a change in thinking around where to place data centers, that speaks to Wisconsin, the Dakotas. 

“The old way of doing things was generate power in one place, and transmit it for thousands of miles. What data centers are understanding with their insatiable and constant need for power is they are more logically placed by power generation so you can buy that off-peak power, to maintain that load consistently. Since solar and wind overproduce [at certain times], if you can harness that imbalance it’s somewhat of a win-win.”

Data centers offer energy peril and promise, with the Midwest increasingly in the crosshairs is an article from Energy News Network, a nonprofit news service covering the clean energy transition. If you would like to support us please make a donation.

As federal incentives spur a wave of new domestic clean energy manufacturing, economic boosters in Ohio and neighboring states see an opportunity to “Make it in Appalachia.”

A virtual summit this month will serve as part of public kickoff efforts to identify and support small and medium manufacturers in the region so they can play a role in the growing clean energy economy.

The New Energy Economy project is being funded by a $10 million federal grant awarded this fall. Lead applicant Catalyst Connection and ten other partners have been working over the past two months to finalize subcontracts for the effort, which encompasses 156 counties in Ohio, Pennsylvania, West Virginia, Maryland and New York.

“By supporting small-to-medium manufacturers and providing training and resources, we can drive economic transformation, create in-demand jobs, and build a brighter future for Appalachian communities,” said Steve Herzenberg, co-director of ReImagine Appalachia, one of the grant partners.

ReImagine Appalachia is hosting its virtual strategy summit on January 16 and 17. The first day will focus on how to turn the Ohio River Valley into a sustainable manufacturing hub, with discussions the next day focused on community rebuilding and workforce development under federal climate infrastructure programs. 

The Appalachian Regional Commission is providing funding for the grant under the federal Bipartisan Infrastructure Law as part of its Appalachian Regional Initiative for Stronger Economies. ARISE supports multi-state projects to drive large-scale regional economic change.

The New Energy Economy project will provide training, technical assistance, supply chain mapping and guidance for factory and product upgrades to more than 1,000 small to medium-sized manufacturers over four years in sectors that include renewable energy, hydrogen, smart grid, green buildings, and electric vehicles.

“We want to identify and support companies that want to participate in a new clean energy supply chain or improve their factory in energy efficiency,” said Petra Mitchell, president and CEO at Catalyst Connection, based in Pittsburgh. Although much of Appalachia is rural, the region includes many towns and cities.

Mitchell said a wide range of businesses could benefit in different sectors. Planned hydrogen hubs, for example, will need lots of metal products and meters, she said. So companies making those types of things may want to think about how they could adapt existing products or develop new ones to serve that sector.

Similarly, lots of pieces and parts go into wind turbines, said Amanda Woodrum, another co-director of ReImagine Appalachia. “They’re made of things that we make already, like gearboxes and bearings.” The grant project can help identify companies that might be a good fit for making those things and provide technical know-how so they can gear up to expand.

Yet there are barriers to getting into new markets.

“Across the region, many small and medium-sized manufacturers lack the capabilities to participate in the supply chains for green energy production or green products manufacturing,” said Janiene Bohannon, communications director for the Appalachian Regional Commission. “Appalachian manufacturers and energy providers seeking to pivot to greener models face difficulties in post-COVID supply chain disruptions, labor shortages, increasingly dated facilities and technology, and lack of availability of training in said technology.”

Opportunity to move ahead

Large manufacturers often have staff or can afford consultants to grow their businesses and navigate entry into new market sectors. 

“Small companies rarely do this,” said Ethan Karp, president and CEO of MAGNET in Cleveland.

The nonprofit will be responsible for providing roughly $1 million in services to companies in Ohio counties covered by the grant. Other manufacturing extension partners will work with companies in the four other states covered by the grant.

More than half of the 32 Ohio counties rank among the 25% most economically depressed counties nationwide.  Only two are “competitive” under the commission’s designation system.

“We can really make a difference there,” Karp said. “We’re going to retain a ton of jobs, and we’re going to strengthen the output and grow our communities.”

Work in the manufacturing sector generally pays better than low-wage jobs that have employed many people in Appalachia after other manufacturing jobs left the area and the coal industry declined over the past several decades. A significant number of people in Appalachia have also become disconnected from the workforce, Woodrum said.

Now, across the five states included in the grant, the project is expected to serve 1,100 businesses, create 5,500 jobs, retain 15,190 jobs and provide $44 million worth of cost cuts, Bohanon said.

“We already have a presence in these counties,” Karp said, adding that MAGNET has already done some work helping manufacturers find opportunities for energy efficiency. MAGNET provides its educational and consulting services free of charge. Companies then invest in projects that can save money or otherwise boost their profit margins.

Lots more outreach about the grant program will follow after the upcoming strategy session for ReImagine Appalachia. Among other things, that outreach will help companies in the region think about whether they can play a role in the clean energy supply chain, even if that role isn’t initially obvious.

“It doesn’t have to necessarily be high-tech stuff,” Karp said, adding that a lot of the shift will be market driven. So, as more electric vehicles come on the market, companies will want to think about how they can be part of that growth. Or, as there’s more electrification, manufacturers may want to think about products they could supply. And then companies will need more training and technical help to expand their businesses through capital investments, any workforce issues and more.

“With the right sustainable strategy and the right investments, we can actually turn the region into leaders in the new energy economy,” Woodrum said. “The kind of manufacturing and the jobs that it creates are a big important piece of that puzzle.”

Historically, “Appalachia’s been one of the most likely places for innovation,” said Rick Stockburger, president and CEO of BRITE Energy Innovators, based in Warren, Ohio, which is not part of the Catalyst Connection grant project. “There’s no structural reason why it can’t be again, especially as we’re thinking about this new economy and how we make sure everybody can participate in it.”

Grant seeks to recruit Appalachian manufacturers for clean energy economy is an article from Energy News Network, a nonprofit news service covering the clean energy transition. If you would like to support us please make a donation.

At Amana Farms, in eastern Iowa, some 2,500 Angus cattle stand at a rail waiting for their breakfast. A truck drives slowly down the line, dumping a mix of hay, corn and distillers grains into the troughs.

Manure drops through the slatted floor into a pit that is scraped every hour, shifting manure to an anaerobic digester nearby. The digester, which acts like a 1.6 million-gallon bovine stomach, processes the manure and other food waste into methane, which is captured and turned into electricity.

“We essentially can power all the homes in the colonies and all the small businesses,” said Amana Farms general manager John McGrath about the Amana Colonies, a set of small towns that are a popular tourist destination.  

Digesters are one solution to the big challenge of reducing greenhouse gas emissions from agriculture, which makes up more than 10% of the total greenhouse gas emissions in the United States as of 2020, the most recent year available. 

Agriculture is a major source of planet-warming greenhouse gases, and farming-intensive states like Iowa — with 13 million acres of corn and seven hogs per person — are outsized contributors, federal data show. Iowa ranks No. 2, behind Texas, for greenhouse gas emissions from agriculture. 

While nationwide emissions from sectors like energy production have fallen in recent decades, those from agriculture — especially livestock and corn — have grown.

Half the states in the country have no greenhouse gas reduction goals, which makes it hard to see how the United States is going to reach its economywide target of a 50% reduction below 2005 emissions levels by 2030.

“It’s purely a political decision, right?” said Steven Hall, an associate professor in the Department of Ecology, Evolution and Organismal Biology at Iowa State University. “If there’s no political will to advocate for such goals, it’s not going to happen absent market-based approaches or voluntary efforts.”

The Environmental Protection Agency has been tracking greenhouse gas emissions since 1990. Over that time, the energy and industrial sectors have slashed their combined emissions by nearly 35%, according to an analysis by The Gazette and Investigate Midwest of the EPA’s Greenhouse Gas Inventory Data Explorer.

The agriculture and transportation sectors each went up more than 6% between 1990 and 2020, but transportation is poised to plummet as more electric cars hit the roads. Modern agriculture, heavily dependent on fossil fuels and nitrogen fertilizer, doesn’t have a solution on the horizon.

Corn and more corn

U.S. corn growers have been planting more than 90 million acres a year since 2018, far more than the 60 million acres in the early 1980s, the U.S. Department of Agriculture reported. Nearly half of that corn nationwide is used to make ethanol. 

The top five greenhouse gas emitters from crop production, according to the EPA’s data since 1990, are, in order, Texas, Iowa, Kansas, Illinois and Nebraska. Producing ethanol also causes emissions, but that carbon dioxide is not counted under agricultural emissions data. Neither are greenhouse gases from fertilizer production.  

Corn requires nitrogen fertilizer to make amino acids, protein and chlorophyll. But too much fertilizer, or fertilizer applied at the wrong time, can cause nitrogen to run off into waterways or to be released into the air as a greenhouse gas.

Iowa farmers bought 5.27 million metric tons of fertilizer in crop year 2022, up 14% from 2021 and up 45% from 2020, according to state sales data. 

Last year was the first year since at least before 2014 that farmers applied more fertilizer in the fall than in the spring, University of Iowa research scientist Chris Jones tweeted in November. Because there’s no crop in the ground after harvest to absorb the nutrients, more go into the air and water.

Livestock

Texas, California, Iowa, Nebraska and Kansas — the top five emitters for livestock, according to the EPA data from 1990 to 2020 — contribute more than one-third of the county’s emissions from cattle, swine and other livestock. 

Some producers are trying new technologies to reduce emissions from their animals, which produce methane through digestion. 

Anaerobic digesters are a costly option at $1 million to $5 million. Iowa passed a bill in 2021 that allows livestock farms to exceed maximum animal thresholds by building a digester to process manure, which caused a flurry of new permits at Iowa dairies.

Another approach is breeding cows that eat less while still producing the same amount of beef, McGrath said. Or including seaweed in cattle feed to reduce methane. 

Lack of progress

Comparing states’ greenhouse gas emissions from agriculture can be like comparing apples to oranges. Or rice to strawberries. Or corn to peanuts. That’s because soil type, climate and crops can influence emissions, but the multipliers used for the calculations are standardized.

“The emission factor for Texas or California is likely to be very different from the emission factor for Iowa, yet the way the emission factor is done doesn’t really take into account the differences,” Hall said.

Looking at a state’s agricultural emissions over time is a good way to see whether there have been changes, Hall said. Among Midwestern states, the trend lines bounce up and down, not showing dramatic improvement.

In many states, there are no plans to scale back. 

Iowa’s annual inventory of greenhouse gas emissions, which uses the trend of inventory numbers back to 1990 to project future emissions, shows emissions from the agricultural sector would increase 83% by 2040 if the state stays on the same trajectory as the past 30 years. 

Iowa has no greenhouse gas reduction goals, for agriculture or any other sector, the Iowa Department of Natural Resources confirmed. Iowa Agriculture Secretary Mike Naig, when asked whether he would support Iowa setting emission targets, said his agency doesn’t have that authority. 

“We must always balance the need to keep Iowa’s agriculture productive while also protecting our valuable shared natural resources,” he said in an email.

Setting goals

Climate change already is disturbing Midwest states with more dangerous storms, loss of animal species and risks of crop loss because of flood or drought. On a global scale, leaders are trying to keep the temperature rise from going above 1.5 degrees Celsius (or 2.7 degrees Fahrenheit) to avoid some of the worst calamities, including inundation of coastal areas and scarcity of food. 

A goal for greenhouse gas emissions is like a road map, guiding decisions along the way, said Jerald Schnoor, engineering professor and co-director at the University of Iowa’s Center for Global & Regional Environmental Research.

Of the 25 states with greenhouse gas reduction targets, 21 have Democratic governors. 

“California is the most progressive state when it comes to tackling greenhouse gas emissions,” said Frank Mitloehner, a professor and air quality specialist at the University of California at Davis. “The state has pursued reductions in a smart way, by incentivizing farmers to reduce their emissions.”

California, led by Democratic Gov. Gavin Newsom, passed regulations to reduce methane emissions from livestock and dairy by 40% below 2013 levels by 2030. The industry has made progress toward that goal, in part by using anaerobic digesters, Mitloehner said.

Illinois is among states that have committed to reducing greenhouse gas emissions by at least 26% below 2005 levels by 2025. The state passed the Climate and Equitable Jobs Act in 2021, but that legislation focuses on the energy and transportation sectors. 

Why not agriculture? 

“In some cases, the infrastructure isn’t quite in place to be able to do it,” said Don Wuebbles, an emeritus professor in the School of Earth, Society and Environment at the University of Illinois. For example, farm machinery still runs on fossil fuels, he said. 

“Part of it is reluctance on the farmer’s part and part of it is reluctance on the entire planet’s part to make things move fast enough to do what we need to be doing.”

Charles Stanier, a University of Iowa engineering professor who served on the Iowa Carbon Sequestration Task Force in 2021, said the bulk of the energy subgroup’s conversations were about CO2 pipelines and requiring public construction projects to use CO2-infused concrete. Both practices together would sequester only a tiny sliver of greenhouse gases, he said. 

Stanier suggested Gov. Kim Reynolds or the Iowa Legislature set a target for emission reductions, but task force members weren’t interested, he said. 

Iowa’s “direction is to monetize the agricultural reductions we can achieve either by having the consumer pay into the agricultural sector for the reductions, or to have the federal government pay,” Stanier said.

Incentives for change

The Inflation Reduction Act, which President Joe Biden signed into law in August, provides $19.5 billion for agricultural conservation, including $8.45 billion more for the Environmental Quality Incentives Program, which helps farmers pay for conservation practices such as growing cover crops during the winter or reduced tilling. Keeping roots in the soil stores more carbon dioxide.

Cover crops grow on about 4% of agricultural acres in the United States, according to data from the USDA’s 2017 agricultural census. More federal cost-share money could mean more farmers trying cover crops, conservation experts said. 

Companies — some to appease customers or boards — also are making investments in sustainable agriculture.

Cargill, which processes meat, eggs and grains for food companies, is offering contracts of up to $25 per acre to corn, soy or wheat farmers in 15 Midwest states to sequester carbon dioxide through regenerative practices, including no till, reduced tillage or cover crops.

Amana Farms earlier this year enrolled 3,300 acres in the program, McGrath said. The Cargill contract will help Amana buy a strip-till machine, which costs about $350,000. 

Since 2013, when Amana Farms stopped tilling 30% of its acres, McGrath has seen a half percent increase in organic material in the soil. So even if curbing greenhouse gases ranks lower on the priority list after improving soil health and water quality, McGrath said, it’s “coming along for the ride.” 

This story is a product of the Mississippi River Basin Ag & Water Desk, an editorially independent reporting network based at the University of Missouri School of Journalism in partnership with Report For America and the Society of Environmental Journalists, funded by the Walton Family Foundation. 

Despite national goals, agricultural greenhouse gas emissions continue unchecked is an article from Energy News Network, a nonprofit news service covering the clean energy transition. If you would like to support us please make a donation.