Bill Supports Families, Powers Businesses and Protects the Environment
COLUMBUS - Ohio House Speaker Jon Husted (R- Kettering) today led the Ohio House of Representatives in the passage of a landmark energy policy for the state of Ohio that helps to establish price stabilization for consumers and embraces new concepts for the state in the areas of advanced and renewable energy.
"Our work represents an energy policy that will protect consumers and provide jobs and cleaner, greener energy for Ohio," Husted said.
Powering Our Businesses and Our Homes
The legislation is Ohio's best strategy for ensuring price stability and an adequate supply of energy generation in the future. The hybrid model offered by the Ohio House, in the form of Senate Bill 221, addresses the needs of businesses, industrial users and residential consumers while also moving toward a greener and cleaner environment through provisions and benchmarks for renewable and advanced energy.
The bill - which received 20 committee hearings in the House alone - protects consumers of electricity from possible rate shock both immediately and in the future. Under the bill, all Ohio utilities would be required to file an electric security plan (ESP) with the Public Utilities Commission of Ohio (PUCO). Utilities would also be permitted to file for a market-based approach through a market rate offer (MRO) at the PUCO.
The hybrid model would allow for the following: if the ESP proves to be lower than the MRO, the plan would be approved. If however, the MRO is lower than the ESP, the utility could go back to the drawing board and file a new ESP, or pursue the market rate offer. Ultimately, by offering both approaches, utilities will be forced to be more efficient providers of energy and consumers will benefit from the lower of the two costs.
To add additional transparency and equality to the process, the House energy proposal also requires the PUCO to hold a hearing and give notice with respect to both options.
The energy plan additionally includes a provision for a state advocate to the Federal Energy Regulatory Commission. The position would help protect Ohio's interests at the federal level by requiring the advocate to proactively address federal issues that affect the price and reliability of electricity in Ohio.
In an effort to encourage businesses to stay in Ohio, the bill allows for special contracts which let high end users of energy to apply to the PUCO for a special rate. This enables Ohio businesses to stay in Ohio and most importantly keep jobs here.
Investing in Advanced and Renewable Energy for Our Environment
The House energy plan contains groundbreaking components focusing on renewable energy in an effort to move Ohio toward using greener, cleaner forms of power such as solar and wind energy, hydropower and fuel cells. The bill creates an advanced and renewable energy standard, ensuring Ohio will take real steps toward increasing the usage of alternative energy.
"In order to thrive in the global economy Ohio must embrace new ideas and technologies," Husted said. "By making a commitment to renewable and advanced energy we will help to build jobs, foster a cleaner environment and reduce our over-reliance on foreign oil."
The legislation - which has received great praise from advocates and environmental supporters - requires that 25 percent of Ohio's electricity is generated from alternative sources by the year 2025. To ensure this standard is met, the House-passed version of the bill contains benchmarks that electric utilities will be required to meet yearly, starting at .005 percent in 2009 and gradually building up to 25 percent in 2025. Broken down, the 25 percent will come from either renewable or advanced energy, with half coming from advanced and half from renewable sources, including at least one half percent from solar energy.
A provision has also been included releasing utilities from meeting the benchmarks if costs increase by more than 3 percent as a result of compliance with those benchmarks.
In addition to promoting the use of new, cleaner forms of energy, the legislation also creates an energy efficiency standard, which would require utilities to meet a cumulative 22 percent standard by reducing usage, beginning with a .3 percent reduction by 2009 and increasing to a 2 percent reduction of use by 2025. Benchmarks and penalties for lack of compliance are also included for this portion of the proposal.
The legislation passed by the House today provides a thoughtful approach to an energy plan for the state of Ohio, focusing on keeping costs reasonable for consumers and businesses, ensuring there is adequate energy available for Ohio in the long-term and making real advancements in the renewable energy sector. The bill passed the House today and now awaits final approval by the Senate.
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