Energy Management

PUCO Chairman to Exit?

This Columbus Dispatch report indicates that that PUCO Chairman Andre Porter will depart the agency soon for a position out-of-state.  He has not been chair very long.

SCOTUS Protects Wholesale Electricity Markets

In a decision with major implications for the recently approved, customer-punishing power purchase agreement (PPA) cases of AEP and FirstEnergy, the U.S. Supreme Court ruled unanimously that a Maryland Public Service Commission (Maryland PSC) plan to boost in-state generating capacity with subsidies paid by ratepayers unlawfully intruded on the Federal Energy Regulatory Commission’s (FERC) jurisdiction over wholesale rates.

The court affirmed that FERC has the exclusive authority to set wholesale energy and capacity prices and oversee whether those rates and charges are just and reasonable.

An OMA Energy Group analysis of the decision notes:  “The Court’s decision bolsters OMA Energy Group’s position in the AEP and FirstEnergy PPA cases before FERC. Just like in the Maryland case, the PPAs in the AEP and FirstEnergy cases guarantee a rate that is distinct from the clearing price set in PJM’s capacity auction. The PPAs at issue in the AEP and FirstEnergy cases guarantee a payment to the generators different from the clearing price set in the PJM auction.”

OMA Energy Group has argued that this type of arrangement, just like in Maryland, impermissibly interferes with FERC’s authority to oversee wholesale rates as the guaranteed revenue stream from customers will make the affiliate generating units agnostic to wholesale-market prices, distort wholesale-market price signals, and deter new entry from competitive generation suppliers.

Read more in this energy blog by OMA counsel Bricker & Eckler.

Tracking U.S. Energy Efficiency Performance

The American Council for an Energy-Efficient Economy (ACEEE) has posted a new web page of national indicators of energy efficiency in the U.S.  The web page shows energy efficiency trends by sector.

According to ACEEE metrics, nationally, energy productivity is trending upward over a five-year period.  Productivity is the amount of service or useful work produced by a unit of energy.

Similarly, the energy intensity of the U.S. industrial sector (manufacturing, agriculture, mining, and construction) has been improving steadily.  Nationally, less energy is needed per dollar of goods produced.

See the data here.

Costly PPA Provisions Summarized

OMA energy counsel, Carpenter, Lipps & Leland, has summarized the provisions of the power purchase agreement (PPA) cases of both AEP and FirstEnergy.

OMA general counsel, Bricker & Eckler, has drafted a summary of the renewable and advanced energy provisions of both cases here.  Bricker also put together a one-pager on what’s next on the matters, which you can read here.

The OMA Energy Group has filed a complaint with the Federal Energy Regulatory Commission (FERC), asking FERC to void the decisions as illegal, customer-punishing incursions into the operation of wholesale electricity markets.  The Energy Group is also evaluating legal options to stop implementation.

OMA Energy Committee Heads to Akron

In response to member interest in more regional opportunities, the OMA Energy Committee will meet in Akron on Wednesday, May 26 from 10:00 a.m. until 1:00 p.m., and includes lunch.

The meeting will be held at Ariel Corp., 3194 Massillon Rd., Akron, OH 44312

As usual, a call-in option will be available at: (866) 362-9768, 940-609-8246#

In addition, members are invited to a networking dinner the evening prior, Wednesday, May 25, at Bender’s Tavern, 137 Court Ave SW, Canton, OH 44702.

Please register here for in-person or call-in attendance, and dinner option.  Or call us at (800) 662-4463.

Senate Republicans Prepare to Extend Energy Standards Freeze

Senator Bill Seitz (R – Cincinnati) shared with interested parties draft legislation to revise Ohio’s renewable and energy efficiency standards.  Senate Bill 310 from the prior session, instituted a freeze of escalating standards.  That freeze is slated to go back into effect in early 2017.

The Senate bill draft would extend the freeze for both renewable energy and energy efficiency for an additional three years.  The bill also reduces annual benchmarks in out years and expands the ability of business customers to opt-out of the riders.

Columbus Dispatch reporter Dan Gearino posted an article describing some early reactions to the proposal.

Webinar: Case Studies in Ohio CHP Success

Since 2012, enabled by Senate Bill 315, electricity customers have been able to seek an energy efficiency rebate for Combined Heat and Power (CHP) and Waste Energy Recovery (WER) systems from their electric utility.

This 90-minute webinar on Tuesday, April 12 at 10:30 a.m. EDT will feature presentations from Jon Williams, AEP-Ohio, Manager, Energy Efficiency & Demand Response, and two AEP-Ohio industrial customers, Kraton Polymers and Solvay Specialty Polymers, that have developed qualifying CHP projects.  Presenters will discuss project financing, efficiency and savings benefits, as well as challenges and lessons learned.

This webinar is designed for CHP and WER developers and electric customers, clean energy policy advocates, technical experts, policymakers and regulators and their staff. This webinar is free and open to the public, but advance registration is required.

PUCO Approves Controversial Utility Affiliate Power Purchase Agreements (PPAs)

This week, the five-member Public Utilities Commission of Ohio (PUCO) convened a special Thursday meeting to approve two proposals, advanced by AEP and FirstEnergy, to implement new non-bypassable riders and other cost-driving provisions.

With the approval of these deals, AEP and FirstEnergy will be able to collect costs from all their customers to subsidize uneconomical generation assets, thus placing all operating risk onto their customers, while guaranteeing their profits.  Their customers will be saddled with the riders for a term of eight years.

OMA estimates cost impacts to manufacturers will range from tens of thousands of dollars to tens of millions of dollars, depending on the amount of electricity consumed.

Because the deregulated electricity market in Ohio has been working to lower costs and spur innovative, new products, the OMA Energy Group has opposed the PPA proposals in the PUCO proceedings.  Many industry leaders have independently expressed concerns to the PUCO.

The OMA Energy Group has filed a compaint before the Federal Energy Regulatory Commission (FERC) to prevent the ruling from going into effect.

OMA Reacts to PUCO PPA Decision

Eric Burkland, president of The Ohio Manufacturers’ Association (OMA), issued a statement yesterday commenting on the Public Utility Commission of Ohio’s (PUCO) decision to approve Power Purchase Agreement (PPA) plans for FirstEnergy and American Electric Power (AEP).

Burkland said, “Today’s decision by the PUCO to approve requests from FirstEnergy and AEP to impose billions of dollars in new customer costs to fund the utilities’ power purchase agreements with their deregulated affiliates is a setback for electricity consumers in Ohio. If implemented, the agreements will serve essentially as new taxes on families and businesses, which will become a drag on the state’s economy.”

Read the full statement.

OMA Asks PUCO for a Stay in PPA Cases

The OMA Energy Group joined the Ohio Consumers Counsel this week to file a motion with the Public Utilities Commission of Ohio (PUCO) to stay a decision in litigation initiated by electric utility companies, AEP and FirstEnergy.  If approved, the stay would delay the PUCO’s ability to issue a decision in the controversial utility affiliate power purchase agreement (PPA) cases until the Federal Energy Regulatory Commission (FERC) has a chance to rule on a related case.

The outcome of the pending FERC case is expected to determine the legality of Ohio regulators being able to approve a utility affiliate PPA.