News and Analysis
On October 4, 2018, the Supreme Court of Ohio issued a decision dismissing the appeal brought by the OMA Energy Group, among others, regarding the Public Utilities Commission of Ohio’s (PUCO) decision to allow the Dayton Power and Light Company (DP&L) to withdraw its second electric security plan (ESP II) after the court had previously determined that the PUCO-approved ESP II included $294 million in unlawful transition charges to customers.
Three justices joined the majority opinion, one justice concurred, and three justices dissented. The majority of the court decided that even though the PUCO approved an unlawful charge and then refused to rectify its error when told to do so by the court, customers would see no relief because a new ESP is now in place.
Kim Bojko of Carpenter Lipps & Leland, energy counsel to OMA Energy Group, wrote: “This decision sets a bad precedent for future cases because it allows the PUCO’s failure to properly implement a court order to go unchecked, to the detriment of customers.”
Dayton Daily News covered the case. 10/11/2018
The Blade reports that a coalition, Ohio Clean Energy Jobs Alliance, consisting of representatives of local government, schools, economic development groups, skilled trade unions, and businesses, has formed to propel legislative efforts to preserve the nuclear power plants, Davis-Besse east of Toledo and Perry Plant east of Cleveland. The coalition is driven by economic impacts should the plants close.
The plants have been unable to compete against cheap and abundant natural gas, and efforts for customers to subsidize operations have been rejected.
OMA’s Managing Director of Public Policy Ryan Augsburger said, “We will be learning more about their proposal and discussing it at OMA’s November 14 energy committee meeting. Any effort to subsidize uneconomical power plants is suspect at best. While manufacturers support nuclear power, it needs to be competitive.” 10/11/2018
AEP Ohio filed a proceeding with the PUCO to address the Tax Cuts and Jobs Act of 2017 (TCJA) issues in its rates charged to customers.
The OMA Energy Group (OMAEG), along with other parties, intervened in this proceeding in order to ensure that members’ interests are protected and that the full benefit of the TCJA is passed back to customers, as required by law.
After extensive negotiations with AEP, PUCO staff, and the other parties to the case, all parties reached a settlement that resolves the tax issues and begins including the effects of the TCJA in the rates charged to customers, including refunds, immediately.
The total value of the settlement to AEP customers is estimated to be more than $600 million.
OMA energy counsel Kim Bojko, Carpenter Lipps & Leland, wrote: “This settlement reasonably addresses the changes in federal tax law brought about by the TCJA and allows all of AEP’s customers to begin realizing tax savings on their monthly bills in November or December. As such, OMAEG joined all other parties to this case in agreeing to the settlement. The parties anticipate that this settlement could be approved in time for November bills to reflect these tax savings.” 10/1/2018
In an affront to Ohio’s policy supporting competitive electric generation markets, AEP asked the PUCO for permission to develop over 900 MW of renewable generation, which would be paid for by customers.
In its filing the Ohio utility claims it needs the generation in order to supply non-shopping customers with generation. In response, OMA energy counsel Kim Bojko of Carpenter Lipps & Leland wrote in her analysis of the case: “AEP Ohio concedes that the PJM wholesale markets are adequately supplying capacity and energy to the AEP Ohio load zone. Nonetheless, AEP Ohio argues that these self-supplied renewable resources are required to “most effectively” meet its obligation to provide a standard service offer (SSO) to its customers.”
The OMA Energy Group is a party to the PUCO case and will be asking tough questions to protect Ohio manufacturers from being forced to pay more distribution charges if there is not clear justification and benefit.
Contact OMA’s Ryan Augsburger to learn more about how your company can support the effort. 9/25/2018
Lightweight Innovations For Tomorrow (LIFT), a Manufacturing USA institute, has just announced the launch of its third round of technology projects.
This round of projects will total more than $6.5 million in combined federal and industry investment to enable a number of critical lightweight solutions. New projects will explore joining dissimilar materials, complex structures and environmentally-friendly approaches to coating metals.
OMA is LIFT’s state partner in Ohio.
Read about the funded projects here. 9/27/2018
Panelists discussed how energy policy can drive economic development during the Midwestern Governors Association held in Columbus this week.
Jake Oster, Head of Energy Policy for Amazon, highlighted how his company is committed to using renewable energy and is developing a system to enable customers to more easily procure renewable power.
Panelist Dana Saucier, Senior Managing Director, JobsOhio, highlighted how competition is driving new energy industry investments in Ohio. He also highlighted the economic benefits to Ohio stemming from the abundance of natural gas in the region.
Moderator Asim Haque, Chairman, the Public Utilities Commission of Ohio, described how his agency has been working to prepare for significant grid modernization.
The governor celebrated the new natural gas power plants coming online in Ohio. 9/20/2018
Governor Kasich participated on an energy panel during the Midwestern Governors Association meeting this week. Kasich is the chair of the association.
In late August, the U.S. EPA officially proposed the administration’s Affordable Clean Energy Rule which is in stark contrast to the Obama administration Clean Power Plan (CPP). If approved, the new rule would replace the CPP.
The Trump proposal is intended to spur coal mining by dialing back environmental emissions restrictions that have hamstrung coal’s competitiveness against more efficient natural gas. Interested parties have 60 days to provide comment according to the EPA fact sheet.
While the OMA and other organizations are still conducting review and analysis, the editorial board of Bloomberg News offered a blistering critique of the Trump proposal citing how competitive power markets are helping to lower carbon dioxide emissions more than any government mandate. The Bloomberg editorial said, “True, it doesn’t help that President Donald Trump is doing all he can to stave off coal’s inevitable decline. In addition to the EPA’s new, doubly misnamed “Affordable Clean Energy” proposal, the president’s Energy Department is pushing a separate strategy to force electricity-grid operators to buy power from coal plants that are at risk of closing — all in the name of national security.” 9/6/2018
Public Utilities Commission of Ohio (PUCO) Chairman Asim Haque this week unveiled the agency’s “PowerForward: A Roadmap to Ohio’s Electricity Future.”
The PUCO says: “The PowerForward Roadmap envisions the future electric distribution grid as a secure, open-access platform that will give customers more control over how they consume electricity, and allow for customers to adopt innovative applications of their choosing as they are introduced on the market.”
The release of the document follows months of hearings on the future of Ohio’s electricity grid and the role of markets to stimulate innovation. 8/29/2018
FirstEnergy Solutions this week announced its plans to close its last Ohio coal-fired power plant, the W.H. Sammis plant on the Ohio River in Stratton in 2021, and its last Pennsylvania coal plant, the Bruce Mansfield plant in Shippingport in 2020.
This comes on the heels of the bankrupt firm announcing the closure of its expensive nuclear plants. The firm has petitioned the Trump administration for bailouts of the plants.
PJM, the grid manager, must approve any plant closures. 8/30/2018
Even U.S. Speaker of the House Paul Ryan on his website celebrates the savings that will flow to electric utility customers as a result of the Tax Cuts and Jobs Act of 2017. But not in Ohio, at least not yet.
While some utilities may have softened their resistance in recent months to sharing the wealth with their customers, the proceedings continue to plod along while utilities in many other states have already made plans to pass along the savings.
Last week the OMA Energy Group filed a brief in support of the PUCO’s ongoing investigation into the tax reductions. Its deferral order is essential to ensure that customers ultimately receive the full benefit of the tax savings created by the tax reform effective January 1, 2018.
Dayton Daily News highlights the case here. 8/23/2018