Don’t let utility reforms hurt Ohio’s energy boom


The state of Ohio and the Mahoning Valley have begun to savor the fruits of an alternative-energy boom hastened by massive new state-of-the-art electricity-generating plants.

In Columbiana County, South Field Energy is constructing a $1 billion 1,105-megawatt natural-gas fired power plant near Wellsville. In Trumbull County, Clean Energy Future continues work at a brisk pact to complete its $890 million Lordstown Energy Center, a mammoth plant to convert clean natural gas into electricity. The same company also is preparing to build the Trumbull Energy Center, a second mirror-image power plant in the booming Lordstown Industrial Park.

The economic, environmental and consumer protection perks of these and other similar projects throughout Ohio are self-evident. Unfortunately, some of those projects – most notably the $1.8 billion Clean Energy investment – fear crippling static from the state’s legacy public utility companies that could derail the valuable endeavors.

Bill Siderewicz, owner of the Boston-based Clean Energy Future, did not mince words about such potential disaster. In a story published on Page 1 of Sunday’s Vindicator, the executive said that if FirstEnergy, American Electric Power and other legacy utilities succeed in large-scale reregulation of public utilities, his projects “would leave Ohio immediately.”

Clearly such a multibillion-dollar blow to the economy of our region and state would be devastating. That’s why all players – independent electric providers, traditional public utilities, state regulators and Ohio lawmakers – must commit to ensuring that no major roadblocks are erected that would impede completion of these projects and lessen energy choices for consumers.

Ever since 1999, when Ohio deregulated its public utilities, the state has offered customers the right to choose electricity suppliers and has largely forbidden preferential treatment toward the legacy carriers.

We and others have largely applauded that deregulation – and rightly so. Expanding competition has saved Ohio electric users some $15 billion over the past five years, according to a report released last month by the Northeast Ohio Public Energy Council. The growth of cleaner and cheaper resources to produce electrical power – plus the state’s proximity to the natural-gas rich Utica and Marcellus shale plays – deserve the bulk of the credit for those impressive savings.

“Deregulation has been a gift to Ohio,” said Chuck Keiper, NOPEC’s executive director.

PLIGHT OF PUBLIC UTILITIES

Not everyone, however, is cheering that trend. FirstEnergy, for example, this week reported taking a $6.2 billion accounting loss in 2016 as its largely coal-fired and nuclear-powered electric plants found it increasingly difficult to compete with lower-priced competition.

To help cushion some of those losses, some public utility company officials have proposed reforms and varying degrees of reregulation of the industry.

Indeed, FE and AEP leaders recently met with state legislators to lay a foundation for potential bills to achieve those ends. Several utilities advocate subsidies to protect and modernize their stock of largely aging power plants to be financed through rate hikes blessed by the state..

Ohio Senate Minority Leader Joe Schiavoni, a Democrat from Boardman, has been involved in those “very broad discussions,” as he called them.

“They haven’t proposed any pieces of legislation yet,” Schiavoni said. “I think we need something that everybody can tolerate and everybody can work with. Something that is fair to consumers and make sure that we keep people working in both sectors.”

The Valley legislator is correct. That’s why time and care must be taken in drafting any legislation with such far-reaching impact. Input should be invited from companies and employees on both sides of the debate, as well as from community leaders.

Once introduced, the legislation should spawn public hearings in the Mahoning Valley and elsewhere in the state so that the legitimate concerns of all stakeholders are properly and fully aired and discussed.

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