The pair of 1950s-era coal plants bailed out under Ohio’s House Bill 6 law are likely to remain unprofitable even after a surge in grid operator payments to generators, experts say. 

The PJM Interconnection grid market makes capacity payments to line up power to meet expected demand in the years ahead. Aging, uneconomical coal plants are being retired at a time when data centers and manufacturers are starting to use more electricity, causing future power generation prices to rise.

But even record-high prices in PJM Interconnection’s recent capacity auction won’t cover the hundreds of millions of dollars in subsidies paid by ratepayers to cover Ohio utilities’ costs for the Ohio Valley Electric Corporation’s Kyger Creek and Clifty Creek power plants.

“Even with a super high price, OVEC is still going to be in the red,” said Neil Waggoner, Midwest manager for the Sierra Club’s Beyond Coal campaign.

The ratepayer subsidies are a result of HB 6, the 2019 state law at the heart of the largest corruption scheme in Ohio’s history. Republican legislative leaders have blocked all efforts to repeal the coal subsidies from coming to a floor vote.

This year alone, ratepayers are on track to pay nearly $200 million to prop up the two plants, one of which is in Indiana. By 2030, total ratepayer costs from the bailout could exceed $1 billion, according to RunnerStone, a consultant for the Ohio Manufacturers’ Association.

Starting next summer, the payments for generators to be ready to supply electricity when PJM Interconnection needs it will jump to about nine times the current rate for most of the grid operator’s service region. 

“Put simply, the market pays participants for the promise to produce electricity when called upon by PJM,” said Daniel Lockwood, a spokesperson for the regional grid operator. An auction sets the levels for each year’s capacity payments, and the payments go to generators that bid the clearing price or less.

A spokesperson for the power plants did not directly answer the Energy News Network’s question about whether both cleared the latest PJM auction, although he described the auction results as “positive.”

“The auction results were a positive development for the OVEC plants and are more broadly a signal to the market that additional generation resources are needed in the PJM region,” said Scott Blake, a spokesperson for American Electric Power and Ohio Valley Electric Corp. While the HB 6 rider charges depend on multiple factors, the impact of the 2025/2026 capacity pricing “is expected to be positive for customers,” he said.

AEP is OVEC’s largest shareholder, along with other utility companies in Ohio and other states.

HB 6’s OVEC subsidies currently require Ohio’s residential utility customers to pay between $1.30 and $1.50 per month, depending on whether their utility is owned by AEP, AES Ohio, Duke Energy or FirstEnergy, according to PUCO data from spokesperson Brittany Waugaman. Businesses pay for the rider, too. The HB 6 rider’s net total costs last year were more than $148 million.

Doing the math

While capacity payments will reduce the OVEC plants’ total costs to Ohio ratepayers, the revenue won’t, in itself, make the plants profitable.

Expert testimony from a Michigan case last year found the OVEC plants would need capacity payments averaging about $418/MW-day for several years to become economical. Last month’s record-high price that will take effect next summer was about $270/MW-day.

Economic analyst Devi Glick of Synapse Energy Economics testified in the case on behalf of the Sierra Club.

“To massively oversimplify the economics of the OVEC plants, there are two categories of costs and two categories of revenues,” Glick told Energy News Network. “Costs are on one side of the equation and revenues on the other.”

Based on then-current projections for costs and energy market revenue, Glick calculated what the plants’ capacity revenues would have to be for the equation to balance out.

Several caveats would apply, Waggoner acknowledged, including any differences from last year to this year that could affect projected energy revenues. Nonetheless, he noted, a significant gap would remain.

Glick’s estimate of about $418 as a break-even capacity price for the OVEC plants is realistic and may even be conservative now, said John Seryak, managing partner for RunnerStone.

“PJM is no longer paying for a coal plant’s full power capacity anymore under new rules it created just prior to this capacity auction,” Seryak explained. “That could mean that OVEC needs even higher-priced capacity and energy to be profitable.”

“Future energy market prices, OVEC’s future coal costs, and OVEC’s environmental compliance costs will also be important factors determining the extent of its losses or profitability,” Seryak continued. “All that said, we do not anticipate OVEC operating at a profit without further price increases.”

Meeting energy demand

Blake emphasized the OVEC plants’ role as a “reliable generation resource for our customers and for our region,” adding that the HB 6 rider “ensures that 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.”

That’s not exactly correct, said attorney Kimberly Bojko at Carpenter Lipps, who represents the Ohio Manufacturers’ Association in cases at the Public Utilities Commission of Ohio. “Customers pay the cost to operate and run OVEC and the power produced from OVEC is then sold into the wholesale electric market,” she said. Any revenue offsets the costs of HB 6’s coal subsidy.

The Ohio Manufacturers’ Association also has disputed the use of the HB 6 rider to pay down the OVEC plants’ debt in cases before the PUCO.

“By using ratepayer funds to pay down its debt, AEP Ohio is essentially shifting its bad debt to the Ohio ratepayers,” Seryak said. “It’s akin to if a person forced their neighbor to pay for their mortgage payment.”

“Customers pay for more than just OVEC’s debt, though,” Seryak added. “Customers also pay for losses in the energy market OVEC incurs. When this occurs, it means the electric grid does not need OVEC for reliability. Instead, OVEC is burning coal pointlessly at a loss and charging it to Ohio’s ratepayers.”

Ohio coal plant subsidies still a bad deal for ratepayers despite growing generation demand, experts say 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.

Ohio clean energy projects under an Inflation Reduction Act grant announced last month show how solar sited on closed landfills can reduce greenhouse gases, improve resilience and provide funding for other environmental goals.

Part of the $129.4 million grant from the U.S. Environmental Protection Agency will add 28 megawatts of solar generation to a county central services facility and four former landfill sites in Cleveland and Cuyahoga County. A bigger chunk of the funding will bring 35 MW of solar and 10 MW of battery storage to a brownfield site in Painesville in Lake County, which will let the city close a coal-fired peaker plant that dates back to 1908.

Representatives of the Cleveland, Painesville and Cuyahoga County governments, along with the EPA and others, met July 26 at Cuyahoga County’s 4 MW solar array in Brooklyn, Ohio, to discuss the grant and the work. Funding from the EPA grant will more than double the generation capacity of that landfill solar site, which has been in operation since 2018.

“In Northeast Ohio we’re going to see warmer, wetter, wilder weather in this region. And we have to do our part to address climate change,” said Mike Foley, director of sustainability for Cuyahoga County.

Funded projects under the grant are expected to eliminate the equivalent of 1 million metric tons of carbon dioxide over a 25-year period, with the largest cuts coming from deploying the solar projects in Cuyahoga County, Cleveland and Painesville, according to Valerie Katz, deputy director of sustainability for Cuyahoga County. 

The biggest chunk of grant money will go to Painesville, which is in Lake County east of Cleveland. But the 28 MW of solar generation to be built in Cuyahoga County will have a big impact.

“This will triple our solar capacity in Cuyahoga County in the next five years,” Katz said.

The landfill and brownfield projects funded by the grant will do more than produce electricity. By avoiding pollution from fossil fuels, they’ll provide health and environmental benefits. They’ll also produce revenue.

Some of the revenue from the brownfield solar site in Painesville will fund natural habitat for pollinators, birds and other wildlife elsewhere on that site. The city plans to work with the West Creek Conservancy for that and other projects, including building public trails and creating access for fishing.

Cuyahoga County also plans to use revenue from its sites to deploy more solar, Katz said. The added solar, in turn, can help develop microgrids to boost resiliency.

Making landfill solar work

While closed landfills provide plenty of open space, they also are often capped by membranes made from clay or other materials that cannot be damaged without risking environmental harm.

Solar arrays at these sites are feasible thanks to ballast systems, which have been fairly common for such uses for more than a decade. Huge concrete blocks anchor the solar array’s racks and panels. The blocks, or ballasts, support the array and protect it from wind. 

“They’re not going through the cap, which works out great for us,” said Jarnal Singh, an environmental supervisor with Ohio EPA’s Twinsburg office in its division of materials and waste management.

Without holes in the cap, the solar array doesn’t provide a pathway for methane or other gases to escape from the landfill. Leaving the cap intact also avoids creating a pathway for water to get in and percolate through the waste. That liquid, called leachate, could pollute groundwater if it’s not collected and treated properly.

Ohio has 141 landfill sites that have been subject to the state’s post-closure care requirements, according to Anthony Chenault, the Ohio EPA’s media coordinator for its Central, Northeast and Southeast districts. The agency has approved four landfills for solar development so far and has had informal discussions about several more sites.

But other practical considerations and site-specific features control whether any particular landfill is suitable for solar development.

“Some factors that could determine viability of a solar installation include proximity to existing power lines, size of the landfill, condition of the landfill cover, ownership (public vs private), and accessibility for equipment and maintenance,” Chenault said via email.

A few years should have passed since a landfill was closed and capped, so some settlement and off-gassing has already taken place, said Scott Ameduri, president of Enerlogics Networks, which was the primary developer for the Cuyahoga County solar site. There also must be a financially sound owner willing to accept responsibility for the waste at the site, he said.

Just as importantly, the electricity will need somewhere to go and a way to get there.

“In Brooklyn, for example, we were fortunate that Cleveland Public Power is a municipal utility,” Ameduri said. Municipal utilities are generally more flexible about making arrangements to take and distribute power than investor-owned utilities, he noted. Community solar legislation, such as House Bill 197, could help change things on that front, he added.

Another option is to have a large off-taker for the electricity adjacent to or near the landfill. The 7 MW of new grant-funded solar power to be built on a landfill south of the IX Center in Cuyahoga County can go to the expo center or the nearby Cleveland Hopkins International Airport, Ameduri said. The general area is also under consideration for one of the Cuyahoga County utility’s microgrids.

Otherwise, a landfill solar project putting electricity onto the grid may require a go-ahead from the regional grid operator, which is PJM for Ohio. The process takes roughly three to five years and adds extra costs. “I’d rather spread that over a 100-MW project than I would for a smaller brownfield site,” Ameduri said.

For now, Cleveland, Painesville and Cuyahoga County are celebrating the EPA grant award.

“This investment will allow us right here in Cleveland to turn brownfields into bright fields,” said Mayor Justin Bibb.

Inflation Reduction Act grant gives landfill solar a boost in Ohio 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.

Research underway at a Madison County solar farm promises to shed light on how well multi-use farming can work at a large scale. The answers will help shape best practices for future projects, while addressing some concerns raised in ongoing debates over siting large solar projects in rural farm areas.

Spread across more than 1,900 acres, the 180 MW Madison Fields project will be one of North America’s largest test grounds for research into agrivoltaics — essentially farming between the rows on photovoltaic solar projects.

As farmers seek to lease land for solar arrays to diversify their incomes, the practice could help them maximize their income and fend off opposition from critics concerned that solar development will take prime farmland out of production.

Some farmers have also said the revenue from clean energy can help keep their farms operating amid pressure from housing developers. A recent report from the American Farmland Trust says Ohio could lose more than 518,000 acres of farmland to urban sprawl by 2040.

That number dwarfs the roughly 95,000 acres for certified and other projects noted on the Ohio Power Siting Board’s most recent solar case status map. 

Yet solar projects generally deal with big chunks of land at once, while urban sprawl happens bit by bit over time, said Dale Arnold, director of energy policy for the Ohio Farm Bureau. Helping people understand and appreciate that is “absolutely huge,” he said.

Savion, a Shell subsidiary, developed the Madison County project, and it began commercial operation on July 11 with Amazon as the long-term buyer for its energy. Yet work began much earlier this year to set up the site for research by Ohio State University scientists, Savion’s Between the Rows subsidiary, and others.

“People have a lot of questions with regard to energy development going forward in this state,” particularly when it comes to taking land out of use for agricultural production, Arnold said.

Yet today’s industry continues to shift away from coal to a diversified portfolio of natural gas, nuclear, hydropower, wind energy, solar energy and other types of generation. Forecasts also show there will be growing demand for electricity by mid-century, he said.

“Finding a balance where you can do a number of things on the same ground — in this case energy production as well as agricultural production — is obviously huge,” Arnold said. If agrivoltaics is to become more than a buzzword, though, both farmers and solar project developers need to work out best practices.

One big issue is what crops can work well for large-scale utility projects. Compared to most solar farms projects in Eastern and Piedmont states, utility-scale solar projects in Ohio and other Midwestern states can spread across 1,000 acres or more, Arnold said.

“You hear a lot about produce and specialty crops,” for example, said Sarah Moser, Savion’s director of farm operations and agrivoltaics. But raising them is “hard to do on 1,000 acres.”

Hay, you!

Moser and Ohio State University researchers think forage crops like alfalfa and hay hold promise. Operations can be scaled up for large areas, said Eric Romich, an Ohio State University Extension field specialist for energy development. And the crops wouldn’t grow too tall amid the panels.

“We also wanted something that we felt had the potential to be economical,” Romich said.

Two 2023 reports by Ohio State University Extension researchers found raising hay and alfalfa between rows of solar panels was feasible and that the harvest’s nutritive value was good. But that small-scale work at the Pigtail Farms site in Van Wert County used data from only a few test plots and controls, which is an important limitation, Romich said.

Work at Madison Fields will now test whether similar results can be achieved at large scale. Part of a $1.6 million grant from the Department of Energy will help pay for that work over the course of four years.

Other research will test how well plants do in sun versus shade, Romich said. That matters because some portion of the land among solar panels will always be shaded.

Researchers planted the crops on test fields and control areas this spring, with an eye toward starting to collect data next year. “Forages are quite temperamental in terms of trying to get them established,” said Braden Campbell, an animal scientist at Ohio State University who is also working on the project. The team has found compacted soil around the solar panels, “but we are relieved to see that the seeds that we put into the ground are growing,” he said.

Moser plans to work with other crops, too. Soybeans are one example. They were already used as a cover crop before alfalfa and hay were planted. Soybeans can also work into a crop rotation when forage crops need to be replanted every few years.

“The market is there for it, and it does well” as a hardy crop which can also loosen soil and restore nutrients to it, Moser said, adding that local communities have expressed interest in the crop as well.

Send in the sheep

Other work at Madison Fields will explore complementary grazing. The goal is to harvest the forage crops as efficiently as possible. But there will still be a need for vegetation control under and around panels and other infrastructure, said Campbell. So, after harvesting, sheep will go to work.

“To me, that’s three commodities that we can get off one unit of land,” Campbell said: Solar panels will produce electricity. Hay and alfalfa growing will provide a crop. And the land will help support sheep, which in turn can produce meat, milk and fiber.

Other solar farms already use or plan to use sheep for vegetation control. But “there is a big difference” between using sheep to keep plants under control and relying on that for their nutrition, Campbell said.

Studies will need to test the health of sheep that do complementary grazing, compared to other sheep. Other questions include finding optimal grazing rates of sheep per acre, as well as other logistics. But first, the forage needs to establish good roots so it can withstand the pressure of grazing.

Tractors and more

A third bucket of research questions under the Department of Energy grant will focus on farm equipment. Tractors and other farm vehicles need to fit between the rows with their attachments. There’s been a trend in the agricultural sector toward wider equipment, which can cover more ground quickly but may not fit between rows of solar panels, Moser said.

“But a lot of farmers still have smaller equipment,” Moser continued, because some parcels aren’t appropriate for wider machinery. Maneuvering 15-foot-wide equipment works fairly well, and 17-foot and even 20-foot widths can still work. 

“I could get my 20-foot drill in there,” Moser said. “I just have to be careful.”

Arnold speculated that some companies may develop special equipment whose attachments can fit under solar panel rows more easily. Other possibilities could include raising panels or even feathering them when agricultural equipment is in use, he suggested.

Farm equipment doesn’t just need to go down an alley between two rows of solar panels. It will also have to turn around at the end to go down another one, Arnold said. So, there needs to be an adequate turning radius, without cables blocking farm vehicles’ paths. Poles, stands, and other equipment also can’t block the path of the farm equipment, he said.

The research can help guide the design of future solar projects to be “hay-ready” sites, Romich suggested. At the same time, agricultural operations shouldn’t jeopardize the safe and efficient operation of a solar facility. “It’s an operating power plant,” Romich said.

Arnold has additional questions about infrastructure needs: What facilities will be necessary to dry, bale and store forage? What facilities will other crops need? And how will they be trucked out to markets?

Likewise, what equipment and facilities will be needed for any sheep kept on site?  That includes paddock fencing, water, and so forth. And where will their caretaker live? 

“You’re going to have to have people there full-time,” Arnold said.

Precision agriculture

The Ohio State researchers, Moser, and others also wonder how well precision agriculture can work with solar farms. The term refers to methods that rely on technology and data to guide farmers’ work. The range of technologies includes remote sensing of field conditions with drones, in-ground sensors, automated weeders and more.

The big question is which precision agriculture technologies can work well for crops planted between rows of solar panels as they generate electricity.

It’s unclear what any of the studies will show until data has been collected and analyzed, Romich said. By the end, he feels the work will provide a better understanding of what will or won’t work.

Economics questions about business models, contractual arrangements and more also must eventually be worked out, Arnold said. At the end of the day, farmers will need to make a profit if agriculture is to successfully blend with solar projects.

“The possibilities are limitless, really,” when it comes to business arrangements, Moser said. “My motto is always, ‘farmers figure it out.’ And if we work with them, we’ll figure…out how to do this with best practices.”

Large-scale Ohio research project to explore how solar and farming can co-exist 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.

Advocates in Ohio are stepping up their clean energy efforts in response to the Republican party platform and Project 2025, which detail how a second Trump administration would promote fossil fuels while cutting back federal programs for addressing climate change, environmental justice and equity.

Over the past year, Ohio-based governments and groups have won awards for hundreds of millions of dollars under the Inflation Reduction Act and the Bipartisan Infrastructure Law. 

Federal policy takes on added significance in a state like Ohio, where lawmakers have already placed extra hurdles in the way of clean energy development. That has left it up to local governments and private organizations to take the lead in cutting greenhouse gas emissions.

Some of that work did move ahead during the former Trump administration, said Mike Foley, director of sustainability for Cuyahoga County, which includes Cleveland. But, “we had to scramble and struggle to get projects done.”

“Having resources from the federal government makes things so much easier,” Foley said.

Just this week, for example, the Environmental Protection Agency announced a grant of roughly $129 million to a partnership among Cuyahoga County and the cities of Cleveland and Painesville to build a 35 megawatt solar power facility and 10 megawatts of battery storage, and to shut down a coal-fired power plant.

Earlier in July, the Federal Transit Authority awarded a $10.6 million grant under the Bipartisan Infrastructure Law to the Greater Cleveland Regional Transit Authority for ten electric buses and chargers for low-income, high-ridership areas. More than $40 million will go to other projects in Ohio. 

“These dollars are changing communities for the better,” said Chris Tavenor, general counsel for the Ohio Environmental Council Action Fund.

Project 2025 — a policy blueprint for a possible Trump presidency produced by the Heritage Foundation — calls for repealing the Inflation Reduction Act and Bipartisan Infrastructure Law, threatening funding for additional work in Ohio and elsewhere, as well as weakening environmental protections and programs to promote equity. While former President Donald Trump has distanced himself from Project 2025, he has multiple links to authors and editors of the roughly 900-page report, and has repeatedly pledged to end Biden energy policies he has dubbed the “green new scam.”

“This is getting rid of everything that’s moved the needle forward on climate and energy,” said Neil Waggoner, the Midwest manager for the Sierra Club’s Beyond Coal program. 

While it’s unclear whether who will win in November, advocates are nonetheless preparing for a potential Trump presidency now.

Maximizing gains

The GOP platform and Project 2025 make clear what types of energy policies to expect if there’s a change in administration, said Melinda Pierce, legislative director for the Sierra Club.

“It’s in black and white,” Pierce said. So now, the Sierra Club is focusing on how to “Trump-proof the gains we have made.”

One push is to help local officials identify and apply for funding opportunities that are available now. “We don’t want to leave that money on the table,” Pierce said, adding that once money is in hand it “buys a lot of goodwill and inertia.”

That goodwill might limit the extent to which federal lawmakers would scale back programs bringing money to their states, according to conservative clean energy advocates who met at the Republican National Convention last week. Others are also collaborating with partners to get money for projects in hand as soon as possible.

“We are taking a proactive approach to reach out to funders to secure funding to continue the work and advocacy for energy, climate and environmental justice,” said SeMia Bray, co-leader for Black Environmental Leaders, which collaborates with regional partners to provide resources and support for environmental and economic justice initiatives.

Jonathan Welle, executive director for Cleveland Owns, said his organization plans to apply this summer for a “substantial federal grant that would put money in the hands of longtime northeast Ohio communities, specifically Black and Brown communities, so they can chart their own energy future.” 

Welle said he’s not at liberty to discuss the proposed project’s details, but did say the group expects it would hear about grant awards late this year or in early 2025. 

“But the timing for that and the follow through from the federal government…is highly dependent on the next few political moves, including November’s election,” he added.

Work to secure federal funding didn’t just spring up overnight, though. The Reimagine Appalachia coalition has been working for several years with stakeholders in Ohio, West Virginia, Kentucky and Pennsylvania to build capacity to absorb and direct that funding. Periodic information sessions spotlight funding opportunities and promote networking for local governments or others to develop ideas for projects. There’s even a forthcoming “grant of the month club” event.

“It’s really important to be doing this work and making sure that this current opportunity is taken advantage of,” said Amanda Woodrum, one of Reimagine Appalachia’s co-directors.

At the same time, she warned against speeding up the process too quickly.

“It takes time to put the infrastructure in place to actually direct it and make sure [funding] doesn’t go to the same old political channels,” Woodrum explained.

Going too quickly also increases the risk of backlash if projects aren’t well thought out, don’t provide what people in communities want, or otherwise fail.

“You don’t want it to go sideways,” Woodrum said. “You want to make sure you do it right.”

Getting the word out

Messaging is another top priority for advocates as the fall election draws near.  

“We are continuing our efforts of voter education, making sure the communities we love and support have updated registration and understand the importance of this election, and all elections on the local level,” Bray said.

Volunteers for Save Ohio Parks have been trying to limit drilling and fracking under state-owned parks and wildlife areas since early 2023, and now face the possibility of more drilling and fossil fuel development under a possible Republican administration.

“Yet Save Ohio Parks is determined to stay positive and keep our eyes on the prize,” said Melinda Zemper, a member of the group’s steering committee. The group is expanding its volunteer base and building additional coalitions with other environmental groups in Ohio.

Advocates also want to get out the word about benefits from current federal programs so voters are aware of what’s at stake.

“The Ohio Environmental Council Action Fund will continue its work to emphasize how the Inflation Reduction Act, the Bipartisan Infrastructure Law, and other important federal programs benefit Ohio communities and help combat the causes of climate change,” Tavenor said. Without continued progress, climate change costs for Ohioans will get worse, he noted.

Messaging by the Sierra Club, Ohio Environmental Council Action Fund and other advocates also highlights the implications of Project 2025 for equity and democracy.

“Project 2025’s extreme proposals are specifically structured to benefit polluting industries at the expense of the health and environment of our communities,” Tavenor said. “Simply put, Project 2025 is a government takeover that threatens our democracy, designed by wealthy billionaires to benefit themselves and their power-hungry allies.”

Ohio advocates seek to ‘Trump-proof’ recent gains made on clean energy and climate 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.

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.