Energy Management

AG Yost Announces Decoupling Deal With FirstEnergy

On Feb. 1, Attorney General Dave Yost announced a “long-term settlement” with FirstEnergy, which has agreed to stop using a House Bill 6-authorized decoupling rider that would cost customers an extra $102 million this year.

In a radio interview this week, Yost said FirstEnergy would ask the Public Utilities Commission of Ohio (PUCO) to zero out the decoupling rider. Shortly after, the PUCO announced that the decoupling rates for FirstEnergy’s Ohio distribution utilities had indeed been set to zero. (This tracker shows FirstEnergy has already collected $27 million from the rider over the past year.)

This week’s legal development comes after the OMA for nearly two years led efforts to oppose HB 6 — including its decoupling mechanism, which had guaranteed FirstEnergy and its subsidiary, Energy Harbor, profits of at least $978 million in gross annual revenues.

It’s also the second recent HB 6-related setback for FirstEnergy. In late December, a Franklin County judge ordered that $170 million per year in HB 6’s customer-funded subsidies could not be collected from customer bills. The OMA helped lead legal efforts to stop the collection of the new subsidies. 2/1/2021

What’s Next in Push to Repeal HB 6?

After this week’s legal developments involving House Bill 6, many Ohioans are wondering what’s next for the state’s scandal-tainted energy law?

For now, the OMA’s focus remains on enactment of Senate Bill 10, introduced by Sen. Mark Romanchuk (R-Ontario) to repeal anti-market, anti-consumer provisions of HB 6. The need for SB 10 to become law was highlighted in a Gongwer News Service article, in which OMA Energy Group counsel Kim Bojko is quoted as saying lawmakers should pass SB 10 to repeal HB 6’s decoupling provision, despite the recent deal brokered by Attorney General Dave Yost (see separate story).

Bojko said: “FirstEnergy didn’t apply to withdraw the rider. They didn’t remove the rider. They just set it to zero. … If it’s set to zero it can be easily repopulated.” She added that she had yet to see in writing where the company had agreed to not implement the rider in the future.

Meanwhile, Sens. Michael Rulli (R-Salem) and Jerry Cirino (R-Kirtland) have introduced Senate Bill 44 to repeal the nuclear subsidies in HB 6. The OMA will offer analysis on this bill as well as SB 10 during its Feb. 25 Energy Committee meeting, which will be held via Zoom. Members are invited to register now. 2/4/2021

EIA: Gasoline, Diesel Prices to Increase Through 2022

Last year, U.S. average gasoline and diesel prices were the lowest they had been since 2016: $2.17/gallon for gasoline and $2.55/gallon for diesel. But the Energy Information Administration (EIA) expects that greater demand for transportation fuels will lead to higher prices during the next two years — including to an average $2.74/gallon for on-highway diesel in 2022. 2/1/2021

HB 6 Repeal Starts Anew in Ohio Senate

Sen. Mark Romanchuk (R-Ontario) on Jan. 27 presented testimony in support of his Senate Bill 10 to repeal provisions of House Bill 6, the tainted nuclear subsidy law passed in 2019. Specifically, SB 10 repeals the decoupling and significantly excessive earnings test (SEET) provisions that were intended to benefit FirstEnergy, while closing the door on decoupling riders for other utilities.

“SB 10 is an important step forward to protect customers,” said OMA president Ryan Augsburger. “We urge the Senate to strengthen the bill by repealing the Ohio Valley Electric Corporation (OVEC) subsidies that were also embedded in HB 6.” Prompt passage of SB 10 is expected. 1/28/2021

U.S. Attorney Leading HB 6 Investigation to Be Replaced

Political appointees who serve at the pleasure of the president customarily move on when there’s a new occupant of the White House. This will be the case for David DeVillers, U.S. Attorney for the Southern District of Ohio, who has conducted the investigation into Ohio’s largest bribery and racketeering scheme, while exposing its ties to House Bill 6. DeVillers charged former Speaker Larry Householder and others with serious crimes for their roles in the scandal.

The news of DeVillers being replaced was confirmed by Ohio’s U.S. Senator Sherrod Brown (D). The Columbus Dispatch (subscription) reports that the prosecution of Householder and others will proceed after DeVillers has been replaced. 1/28/2021

Don’t Be Misled by This Energy Conference

Manufacturers may have seen promotional materials for an energy conference that will be held virtually in mid-February. The promotional materials display the OMA logo. Please note that the OMA has not endorsed or authorized the use of our logo for this event.

Here’s a better option: Register now for the OMA Energy Committee’s Feb. 25 meeting via Zoom. You will learn accurate and valuable information to help you manage energy costs, while also being afforded the opportunity to contribute to the OMA’s efforts to improve Ohio’s energy policy. The OMA Energy Committee meets quarterly and is open to all members. Energy intensive manufacturers will want to consider membership in the OMA Energy Group. 1/28/2021

EIA Predicts Less Power Generation From Natural Gas

In its latest short-term projections, the U.S. Energy Information Administration (EIA) forecasts that generation from natural gas-fired power plants will decline by about 8% this year. If true, it would mark the first annual decline in natural gas-fired generation in four years. Generation from coal-fired plants is expected to increase by 14%, while generation from non-hydropower renewable energy sources is forecast to grow 18%. 1/21/2021

Governor Wants Another List of Finalists for PUCO Chair

In a rare move, Gov. Mike DeWine this week rejected the first round of nominees to replace former Public Utilities Commission of Ohio (PUCO) Chairman Sam Randazzo. As permitted by law, Gov. DeWine requested a second and final list from the PUCO Nominating Council.

Hannah News Service reported that the governor “said he will consider previous applicants as well as new ones,” leaving the door open to further consideration of DeWine policy adviser Anne Vogel, consumer advocate Greg Poulos, and federal energy adviser Angela Amos. The list of applicants is now shorter since former Supreme Court of Ohio Justice Judith French was recently appointed director of the Ohio Department of Insurance.

The nominating council is scheduled to meet today (Friday, Jan. 22) to conduct interviews for a separate PUCO appointment as Commissioner Dennis Deters’ term expires in April. 1/22/2021

Biden Cancels Permit for Keystone XL Pipeline

In one of his first actions from the Oval Office, President Joe Biden this week rescinded the federal permit for the Keystone XL pipeline, at least temporarily erecting a barrier to its progress.

In a press release, National Association of Manufacturers President and CEO Jay Timmons said: “Manufacturers are disappointed with the administration’s decision to block this sustainable project, which can serve as a model for infrastructure of the future, and if not reconsidered, represents a missed opportunity for manufacturing workers in America.” 1/20/2021

Air Authority Complies With Courts, Blocking Collection of HB 6 Subsidy Charges

The Ohio Air Quality Development Authority (OAQD), which oversees House Bill 6’s nuclear subsidy program, this week complied with recent court orders to block the collection of the law’s subsidies paid by consumers. A resolution adopted by the OAQD temporarily revokes and suspends the approval of Energy Harbor’s application for subsidy payments under HB 6.

The OAQD’s move follows last month’s preliminary injunction granted by a Franklin County Common Pleas Court judge who blocked the Jan. 1 start of the law’s subsidy charges. The Ohio Supreme Court also issued its own order to prevent the commencement of the subsidy charges. The OMA was heavily involved in both legal proceedings. 1/13/2021