October 21, 2014

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Strickland presents energy plan

COLUMBUS — Financial protection for consumers and the development of alternative energy sources were at the heart of Gov. Ted Strickland’s long-awaited energy plan released Wednesday.

The stabilization of electricity rates and the development of new resources is vital to keeping jobs from leaving Ohio for states with lower rates, Strickland said.

AP
Gov. Ted Strickland announces his energy plan in the statehouse atrium Wednesday in Columbus.

Strickland also wants a minimum of 25 percent of electricity sold in Ohio by 2025 to be generated by what he calls “advanced energy technologies.” Those include clean coal, new nuclear power technologies, fuel cells and renewable energy sources such as wind, water and solar power.

Ohio lawmakers passed an electric deregulation law in 1999 aimed at allowing competition between suppliers and lowering customers’ bills. The law required a transition period with frozen distribution rates for big utilities and a 5 percent discount on generation to allow the market to develop.

However, competition never developed because no one has been able to beat what utilities now pay for power.

The Public Utilities Commission of Ohio has continued to regulate the distribution and transmission of electricity to customers.

But rate stabilization plans are set to expire at the end of 2008 for Akron-based FirstEnergy Corp., Columbus-based American Electric Power Co. and Duke Energy Corp., which supplies power in southwest Ohio. Dayton Power & Light Co.’s plan expires in January 2010.

Strickland said the state must step in again to prevent price spikes once the stabilization period ends. He noted Illinois, where rates increased up to 50 percent once competition became a reality, and Maryland, where rates shot up 72 percent. Strickland said it’s too early to determine what the impact would be on residential rates in Ohio.

“We cannot let happen (in Ohio) what happened in Maryland and what happened in Illinois,” Strickland said at a briefing for reporters.

PUCO would sign off on any plans by electric utilities to change rates in Ohio. The panel also has the power to approve a utility’s decision to bring competition to the sale of power.

Many groups have offered solutions to the problem, including those of industrial and commercial users that wanted a return to strict regulation by the state.

FirstEnergy, which provides power to more than 2 million customers in northern Ohio, agrees that keeping jobs in Ohio is important but has concerns about cost, especially the plans to produce clean coal and add more nuclear power, spokeswoman Ellen Raines said. She said the technologies for those energy sources are in their infancy.

“We don’t know how that squares with rate stability. All of those items have significant price tags,” Raines said.

Erin Bowser, executive director or Environment Ohio, a nonprofit advocacy group, said her group would have liked more emphasis on “clean” renewable energy, such as wind and solar power.

“Because we have lumped coal and nuclear power into this plan, we are continuing to not give the lift we need to renewables to develop,” she said.

Some of Strickland’s ideas would save customers money, said Ohio Consumers’ Counsel Janine Migden-Ostrander, whose office represents residential customers in rate cases. However, she has concerns about some of the ways utilities could increase rates by passing on the cost of new plants and pollution control equipment.

Strickland would like legislation on his plan completed by year’s end. If the plan clears the Republican-controlled state Legislature, the Public Utilities Commission of Ohio would have to find a way to implement it.