Energy Management

House Bill Freezes Energy Standards Forever

Speaker Pro Tem Ron Amstutz (R-Wooster) proposes to eliminate Ohio’s energy efficiency and renewable energy standards in his recently introduced House Bill 554.

Legislation last session froze the standards until January 1, 2017, in order to give the legislature time to study the standards.  If the legislature does not act prior to that date, the standards will go back into effect.

Meanwhile, hearings continue in the Senate on Senate Bill 320, introduced by Senator Bill Seitz (R-Green Township), which would extend the freeze for three years and make multiple changes to Ohio energy law.

Kasich Picks Haque for PUCO Chair

This week Governor Kasich named Asim Z. Haque, a member of the Public Utilities Commission of Ohio (PUCO) since 2013 and the current vice chair, to serve as chairman of the commission.  Haque will succeed Andre Porter, who recently announced that he would step down as chairman on May 20 to accept a position in the private sector.

Haque was first appointed to the PUCO by Gov. Kasich in June 2013 to complete three years of an unexpired term and recently reappointed by the governor to a full five-year term.  His term will expire in April 2021 and the appointment is subject to the consent of the Ohio Senate.

Haque holds a bachelor of arts degree in chemistry and political science from Case Western Reserve University and a juris doctorate from The Ohio State University Moritz College of Law.

FirstEnergy Doubles Down on Subsidy Demand

One week after its proposed “power purchase agreements” (PPAs) were halted by the Federal Energy Regulatory Commission (FERC), FirstEnergy filed a new subsidy proposal to the Public Utilities Commission of Ohio (PUCO).  The company wants the PUCO to approve it by May 25 so that it can go into effect on June 1.

Essentially walking away from any pretense that its proposal is anything more than a costly bailout, the filing drops the PPAs and any connection to the wholesale markets.  Instead, the subsidies are based on the company’s own past projections of future costs, not actual costs set by the market.

Once again, customers potentially have more than $3 billion over eight years at risk.

Read a good summary of the proposal in the Cleveland Plain Dealer.  We’ll have a full analysis for members in a few days.

AEP Accepts FERC Decision

AEP this week accepted the Federal Energy Regulatory Commission (FERC) decision that rescinded a waiver that would have allowed its Public Utilities Commission of Ohio (PUCO) approved “power purchase agreement” (PPA) between its distribution utility and its affiated power plants.

The company now is asking the PUCO to approve a PPA only for the power it controls as part of the Ohio Valley Electric Corp. (OVEC) in southern Ohio. OVEC generates 440 megawatts, or less than 15% of the total previously requested by AEP.  OVEC is the only plant owned by the AEP distribution facility (rather than its retail generation affiliate).

AEP has indicated it will continue to push for customer-financed wind and solar projects totalling 900 megawatts, and that it will seek legislative “re-regulation” of generation.

Energizing Manufacturing

The National Association of Manufacturers (NAM) released a comprehensive study of the benefits of natural gas and natural gas infrastructure this week.

The study finds:  “Total natural gas demand is poised to increase by 40% over the next decade. Key drivers will be manufacturing and power generation. U.S. supply is expected to increase by 48% over the next decade to meet new demand.”

Among the economic benefits:

• Natural gas access contributed to 1.9 million jobs economy-wide in 2015.
• Shale gas put an extra $1,337 back in the pocket of the average American family.
• New natural gas pipelines created more than 347,000 jobs, with 60,000 in manufacturing.

The study calls for more infrastructure development to allow American manufacturers to take full advantage of the U.S. natural gas resources.

Read the report, and its summary, here.

Don’t Be in the Dark about LED Lighting, webinar

The OMA Energy Efficiency Peer Network (EEPN) has scheduled a one-hour webinar on Wednesday, May 25 at 10:00 a.m. – Technology Check-in: LED Lighting in Manufacturing Facilities. 

LED lighting technology and costs change rapidly. This presentation will update you about current LED technology and how it is being applied in manufacturing environments, including:

• Exterior, High Bay and Low Bay applications
• Are the T8 linear fluorescent to LED tube retrofits a good idea? Cost effective?
• Tips to ensure quality in LED projects
• Are all LED fixtures always the most efficient options?
• Should you consider replacing fluorescent lights with LED lights, or just HID?
• How to optimize LEDs with occupancy, dimming and photo-sensor controls
• What are the approximate economics of different LED applications or situations?

The webinar will also feature case studies presented by peer manufacturing facilities.

All interested members welcome!  Register at My OMA or call us at (800) 662-4463.

Manufacturers Receive AEP Ohio Energy Efficiency Award

Last week AEP Ohio honored organizations that have demonstrated a strong commitment to energy efficiency.

Crown Battery Manufacturing Company, Fremont, received a Sustained Excellence Award for its energy efficiency efforts over multiple years as well as for making energy efficiency a part of company culture.  (You may recall the OMA Energy Efficiency Peer Network held a plant tour at Crown Battery last year.)

Additional recognized manufacturers were Bridgestone, Upper Sandusky, and LuK, Inc., Wooster.

AEP Ohio offers a variety of energy efficiency programs and discounts to help business customers conserve energy and save money.  Through the programs, AEP Ohio customers save an estimated $2.2 billion over the life of the measures.  For more information visit AEP Ohio or contact OMA’s energy engineer, John Seryak.

FERC Halts PUCO’s Approval of AEP & FirstEnergy Non-bypassable Riders

This week the Federal Energy Regulatory Committee (FERC) issued a decision that halts the underlying transactions of the Public Utilities Commission of Ohio (PUCO)-approved subsidy requests from Ohio-based utilities AEP and FirstEnergy. Their bailout proposals would have forced Ohio customers to subsidize old, inefficient power plants for the next eight years at an estimated cost of $6 billion.

OMA president Eric Burkland issued a statement commenting on the FERC’s decision, saying:  “The OMA strongly opposed the PUCO decision that harmed wholesale markets that are benefitting Ohio electricity consumers and that served to subsidize potentially uneconomic utility generating units. … The unanimous FERC decision is welcomed by Ohio manufacturers that depend on markets to provide the cost and innovation benefits of competition.”

The non-bypassable new costs under the PUCO-approved plans would have come at a time when the competitive electricity marketplace has begun to mature and is producing benefits in cost savings and innovative, new products. The utilities’ plans would add costs to customers’ bills with no commensurate benefits.

In an effort to prevent the potential damage, the OMA Energy Group, among others, pursued its available legal appeals to the FERC.

This one-page summary of the FERC decision prepared by OMA energy counsel, Carpenter Lipps & Leland notes: “FERC agreed with the arguments asserted by OMAEG (OMA Energy Group) … that customers are captive because they have no ability to avoid the costs associated with the Affiliate PPAs by shopping with a competitive supplier.”

To learn more about how through the OMA Energy Group you can effect change that protects your company, please contact OMA’s Ryan Augsburger.

Energy Standards Freeze Introduced

Senator Bill Seitz (R-Green) introduced a bill, Senate Bill 320, that extends the freeze on the state’s renewable and energy efficiency standards for another three years.  The bill makes extensive other changes to the state’s energy statutues.

Read this analysis prepared for the OMA by Runnerstone.

Ohio Supreme Court Finds PUCO Erred

Late last week, the Ohio Supreme Court decided two separate cases impacting AEP customer charges.

In the first case, Justice Sharon Kennedy authored the high court’s decision finding that the PUCO incorrectly authorized AEP to recover from customers the equivalent of transition revenues through the retail stability rider. This is a significant win for customers, estimated to result in a $310 million reduction to customers.

In another case also authored by Justice Kennedy dealing with AEP’s capacity-pricing mechanism, the court found in favor of AEP, stating that the PUCO erred by failing to adequately explain the method it used to calculate credits used to reduce the capacity charge.  The court did not find that the capacity charge collected was incorrect, just that the PUCO had not adequately explained its decision.

Both cases were sent back to the PUCO.