Ohio lawmakers pass energy bill ending ratepayer charges that subsidize 2 unprofitable coal plants

The Ohio Senate passed its version of the legislation in a rare unanimous vote Wednesday, before sending it back to the Ohio House.

In Columbus, Ohio, state lawmakers have finally decided to stop the funding for two old coal plants that were running at a loss and costing Ohio residents almost $400,000 every day. These plants, which were deemed unprofitable relics from the Cold War period, were added to a controversial energy bill at the heart of a major corruption scandal in the state.

The new House Bill 15 aims to promptly terminate the subsidy known as the “legacy generation rider” for the two Ohio Valley Electric Corp. facilities that were initially included in House Bill 6 back in 2019. This move is part of a broader effort to update Ohio’s energy regulations.

The Ohio Senate unanimously passed its own version of the bill on Wednesday and then sent it back to the Ohio House for further review. Subsequently, the House voted 94-2 in favor of accepting the Senate’s amendments to the original House bill.

The bill goes next to Gov. Mike DeWine, whose office said he is reviewing the amended measure.

State Rep. Casey Weinstein, a Hudson Democrat, praised the measure’s passage, calling the end of the “bailout” of the two coal two plants — one in southern Ohio, one in Madison, Indiana, southwest of Cincinnati — a huge win for consumers.

“It was an outrageous misuse of public funds — sending hundreds of thousands of dollars a day to an aging coal plant in Indiana,” he said in a statement. “Putting an end to that is a victory for ratepayers across the state.”

The bill also requires utilities to routinely come in for rate cases and justify how they spend ratepayer-collected money; creates a permissive school energy efficiency loan program to reduce energy costs for public schools; and codifies that consumers must receive refunds for improper charges.

Ohio Manufacturing Association President Ryan Augsburger said repealing the uneconomical subsidies and other charges and creating energy “heat maps” that visually depict energy usage patterns will allow manufacturers to operate more efficiently.

“Ohio has an abundance of natural resources, a strong workforce, world-class educational institutions and now the foundation for a nationally leading energy industry,” he said in a statement. “Now is the time for Ohio’s energy system to pull ahead and attract new generation, bringing with it new economic investments.”

The OVEC subsidy was a late addition to the measure passed Wednesday, which initially focused on a $1 billion bailout for two nuclear power plants owned by a then-subsidiary of Akron-based FirstEnergy Corp. It was to have been collected through Ohioans’ electric bills through 2030.

The Legislature repealed the nuclear plant subsidy contained in the bill in 2021, months after then-Ohio House Speaker Larry Householder and four others were indicted for their roles in a $60 million bribery scheme secretly funded by FirstEnergy to win passage of the bailout bill.

But the coal plant subsidy has been tougher to eliminate.

The two plants were built in the 1950s to provide power to a uranium enrichment facility in Pike County, but the contract with the U.S. Department of Energy ended in 2003 and OVEC began selling power to the regional power grid. The rise of cheaper and abundant natural gas helped make the plants unprofitable.

The state’s utility watchdog at one point said the coal plant subsidy was worse than the one for the nuclear plants, because it helped sustain plants whose electricity wasn’t needed and that pollute the air.

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