FirstEnergy Solutions will get its $150 million a year bailout from the state’s electricity customers to save its two northern Ohio nuclear power plants.
The House, by a 51-38 vote Tuesday, agreed to changes in House Bill 6 approved by the Senate last week. Gov. Mike DeWine immediately signed the bill into law, completing the biggest overhaul to the state’s energy laws in more than a decade.
“This is something that needed to be done, and the legislature rose up and took care of business,” House Speaker Larry Householder, R-Glenford, said after the vote.
House leadership arranged on Monday — with the approval of DeWine’s office — to dispatch a State Highway Patrol airplane to Chicago to pick up some House members attending a conference to ensure their return and presence for what was expected to be a close vote.
However, after research determined the cost of the state plane was $5,677, the flight was canceled hours later by House officials late Monday and the members drove back or took commercial flights to make the House session.
The House action and the governor’s signature brought a quick end to an intense and bitter months-long fight that featured a multimillion-dollar statewide television, radio and mail campaign. Unlike other bills, the legislation didn’t break along party lines; supporters and opponents included a mix of legislators from both parties.
After the vote, visitors in the gallery applauded. Workers from both power plants, along with other supporters, have been fixtures in legislative hearings on the proposal.
Public officials and a cadre of industry lobbyists pushed for the bill along with a variety of trade unions looking to save the 1,400 jobs at the plants. Environmentalists, some business groups, and oil and gas interests fought the legislation.
“House Bill 6 is still a very bad bill that puts Ohio on the wrong track,” said Trish Demeter, advocate for the Ohio Environment Council Fund.
The new law will impose a fee of 85 cents a month on residential ratepayers from 2021 through 2027, generating about $170 million a year.
Most of the money, about $150 million a year, will shore up the Davis-Besse and Perry nuclear plants, which generate about 15% of Ohio’s electricity. Without that aid, FirstEnergy Solutions, the former power generation arm of Akron-based FirstEnergy that is working through bankruptcy protection, has said that it would have to close the plants.
The money for the plants is subject to an annual review, so the subsidy could be reduced or eliminated in future years should it no longer be necessary.
The company did not respond to a request for comment Tuesday.
The rest of the money will go to help the development of six solar projects being developed in the state.
Proponents say a key aspect of the legislation is that it will cut the average residential electricity bill by $2.77 a month in 2021, leading to a savings of $1.3 billion over nine years. The savings come from gutting fees consumers pay for energy efficiency and renewable energy programs.
Utilities will be required to get 8.5% of their power from renewable sources by 2026, but then that requirement will be dropped. Opponents say that will hinder development of renewable energy in the state. Previously, utilities were required to get 12.5% of their power by that date.
The move is in contrast to several surrounding states, which have increased their renewable energy requirements. Michigan, for example, has set a 35% requirement by 2025.
Householder said the old legislation, enacted more than 10 years ago, has failed to lead to a surge of renewable projects as had been projected at the time. He noted that the state gets just 3% of its power from renewable sources today.
“That mandate has failed miserably and it has cost millions and millions of dollars to the ratepayers of this state,” he said.
Even though the Senate version of the bill delayed the enactment of the fee by a year, Householder said it was important to act now.
“This is all about the folks that are going to finance these nuclear plants and the message that we’re sending to those people (is that) we want to be a partner with them to keep those plants in the state of Ohio and benefiting the ratepayers of the state of Ohio,” he said.
But the bill’s opponents said that the old legislation has led to the creation of 112,000 clean-energy jobs and that energy-efficiency programs such as the sale of energy-efficient appliances and light bulbs have saved consumers $5.1 billion in the form of lower utility bills.
They say the result will be dirtier air, higher utility bills and fewer incentives for businesses and homeowners to add rooftop solar arrays.
They also are angered by the bill’s bailout of two coal-fired, money-losing power plants, one in Ohio and one in Indiana, owned by a group of power companies that include American Electric Power. Electricity customers will pay a fee of as much as $1.50 a month through 2030 to support those plants..
“We should be investing in our communities and putting Ohio first and not forcing Ohioans to spend over a billion dollars bailing out bankrupt nuclear facilities and an Indiana coal plant,” said Rep. David Leland, D-Columbus. “Our goal here should be to solve the issues surrounding the nuclear facilities without destroying Ohio’s opportunity to be a part of the clean energy industrial revolution.”
One company, New Jersey-based LS Power, already has warned it will cancel a $500 million expansion project of its natural gas-fired plant in Luckey in northwestern Ohio if the bill became law.