News and Analysis
Northeast Ohio Public Energy Council (NOPEC) announced that it is the first organization in Ohio to offer new U.S. Department of Agriculture low-interest loans designed to help small businesses lower their energy consumption and costs through energy-efficient upgrades.
Owners of commercial property within a NOPEC member community are eligible to apply for financing for projects ranging from $5,000 to $100,000.
Energy upgrades that qualify include HVAC, interior and exterior lighting, insulation, windows and doors, and other renewable energy projects such as solar water heating systems.
For larger projects, NOPEC offers financing up to $500,000 through its Property Assessed Clean Energy, or PACE, program. 7/11/2018
From OMA Connections Partner Barnes & Thornburg: “On June 22, 2018, the IRS issued Notice 2018-59, which provides long-awaited guidance relating to the “beginning of construction” requirement for solar projects and other renewable energy projects that qualify for the 30% investment tax credit (ITC) … In addition to solar projects, this notice applies to qualified fuel cells, qualified microturbines, combined heat and power systems (CHP), wind farms using small turbines of 100 kilowatts or less, and geothermal heat pump properties.”
Read more from Barnes & Thornburg here. 7/4/2018
This week the Supreme Court of Ohio heard oral argument in two AEP Ohio cases appealed by the Ohio Consumers’ Counsel (OCC) and The Ohio Manufacturers’ Association (OMA), in which the parties argued that AEP Ohio customer charges associated with its interest in the coal-fired Ohio Valley Electric Corporation (OVEC) are unlawful and violate the General Assembly’s move to electric competition.
The court will consider whether subsidies approved by the Public Utilities Commission of Ohio (PUCO) for AEP Ohio’s stake in OVEC constitute illegal charges in an otherwise deregulated market.
A decision is expected in late 2018 or early 2019. 6/26/2018
Said to be a top priority for the Ohio Senate back in January, House Bill 114, the legislative package to revise the state’s alternative energy requirements, languished until mid-May, at which time, the Senate unveiled numerous changes. As it stands, the pending legislation is a mixed bag for Ohio manufacturers.
Significant controversy has resulted from a Senate amendment to relax the current restrictions governing the siting of wind turbines.
Additionally, a witness for AEP appeared before the Senate Energy and Natural Resources Committee this week to take issue with a provision the Senate included to introduce competition into energy efficiency projects. Currently, all such energy savings programs are administered by one of Ohio’s four monopoly electric distribution utilities. In testimony on June 6, a witness from competitive retail electric supplier IGS appeared to make the case for expanded competition of energy efficiency programs to better benefit customers.
Eyes will be on the Senate next week to see if the committee approves the bill and sends it to the Senate floor before the start of the General Assembly’s summer recess. 6/21/2018
Yesterday, the U.S. Senate Committee on Energy and Natural Resources held a hearing on President Trump’s plan to bail out failing nuclear and coal plants in the name of national security along with grid reliability and resiliency.
All five Federal Energy Regulatory Commission (FERC) commissioners testified at the hearing. Senators from both parties were skeptical that an anti-competitive bailout was necessary. Committee Chairwoman Lisa Murkowski, a Republican from Alaska, argued that, rather than pursue this type of bailout, FERC “should be pointing the way on grid vulnerabilities, while reaffirming our commitment to competition in wholesale power markets.”
FERC commissioners also expressed varied levels of skepticism related to this plan, with some saying that this kind of government intervention in the market would throw the power markets “into chaos” and another stated that the markets are currently working “hyper-efficiently.” Another commissioner acknowledged the current efficiency, but stated that FERC will remain vigilant and will not assume that its good fortune would continue, noting that he believed portions of the president’s approach had been well-researched and warranted further study.
Chairwoman Murkowski urged the commissioners to lead on this issue and move quickly to determine a policy in the face of pressure from the administration. 6/13/2018
The Trump administration evidently plans to order customers to subsidize unprofitable nuclear and coal power plants owned by FirstEnergy Solutions (FES). The controversial and unprecedented move by the president appears to have been in part the result of a lobbying blitz.
John Funk of the Cleveland Plain Dealer reported that “Akin Gump’s top law partners charged (FES) as much as $1,475 an hour.”
Bottom line: FirstEnergy and FES want someone, anyone – preferably customers or taxpayers – to pay billions to make up for the company’s bad business decisions. 6/14/2018
Late last week Bloomberg News reported that President Trump had ordered Department of Energy Secretary Rick Perry to prevent the retirement of some nuclear and coal power plants.
The move will require customers to subsidize unprofitable power plants that cannot compete in the generation market.
The bailout proposal had been sought by Ohio utility FirstEnergy and its bankrupt affiliate FirstEnergy Solutions, which owns three nuclear power plants and several outdated coal power plants.
The order is unprecedented in its novel usage of national security to justify the bailout.
The OMA has been an active opponent of state and federal power plant subsidies that distort the function of the market.
Manufacturers in the PJM region can expect to see a new charge on power bills that will not offer any benefit to customers or solve a legitimate problem. PJM Interconnection, the grid operator in 13 states, issued this statement.
Here’s a brief summary from OMA energy counsel Carpenter Lipps & Leland. Needless to say, we will keep members posted. 6/7/2018
The good: It eases regulations that limit manufacturers’ ability to site wind turbines on their properties; it makes opt-out from energy standards easier when cost benefits don’t work out; and it maintains (but lessens the targets of) energy efficiency standards and their benefits.
The bad: It allows distribution utilities to “bank savings” under energy efficiency programs, the effect of which will be to increase manufacturers’ bills, and with no benefit at all. 5/31/2018
In good news for manufacturers, the Public Utilities Commission of Ohio (PUCO) rejected legal arguments from the state’s four electric utilities challenging the PUCO’s authority to examine the impacts of the reduction in corporate income tax on utility rates, saying American Electric Power, Dayton Power & Light, Duke Energy and FirstEnergy – and all regulated companies – must continue to set aside all money from the tax cut until plans are made to return funds to customers. 5/31/2018
The OMA’s Sustainability Peer Network will meet in the OMA offices on Tuesday, June 19 from 10:30 a.m. -2:30 p.m., and includes lunch.
The no-charge forum for manufacturers only will provide participants with in-depth peer discussions on two topics of interest to the manufacturing community:
- Emissions reduction tracking and reporting
- Engaging employees on energy reduction
Additionally, leadership from the U.S. Department of Energy (DOE) Better Plants program will share experiences with treasure hunts, in-plant trainings, and continuous energy improvement.