Ohio’s ‘freeze’ on renewable energy is already costing the state big time

blue creek wind farm

The Blue Creek Wind Farm in Van Wert County (courtesy of The Dayton Daily News).

One month ago (well, one month and 4 days, but who’s counting?), Ohio became the first state in the country to freeze its clean energy standards, when Governor Kasich signed SB 310 into law. At the same time, the Governor signed HB 483, the Mid-Biennial Review of the budget, into which the Ohio GOP slipped a new setback requirement for wind turbines.

The American Wind Energy Association, along with other opponents of these bills, warned lawmakers about their potential impacts on the state’s budding clean energy industry. In a press release issued shortly after the Governor signed both bills into law, AWEA said:

Gov. John Kasich and the Legislature today abandoned $2.5 billion in current wind energy projects, which now face cancellation along with jobs, leases, payments to local governments, and orders for factories, over a needlessly restrictive setback requirement that Kasich signed into law today.

In a press conference yesterday, Governor Kasich tried to defend his record on clean energy and environmental issues. He once again claimed that he played an essential role in “moderating” SB 310, ensuring that the bill only froze the standards, rather than rolling them back altogether. He also defended the increased setback rule for the first time publicly, telling a group of business leaders in Bellview,

“Private property rights are important. People choose to live somewhere. You just don’t go in there and disrupt their life.”

Now, the Dispatch piece does not explain if the Governor feels the same way about oil and gas wells, for which the Ohio Revised Code only mandates a 100- to 150-foot setback rule; given his history with the fossil fuel industry, I’m going to guess not. But based on the Governor’s comments, it would seem like SB 310 and HB 438 should have minimal impacts.

Senator Bill Seitz (R-Cincinnati), who never met a hyperbolic statement he didn’t like, echoed the Governor’s views. In an article on Gongwer (paywalled) from May, he said,

Today is just the latest in a long line of sky-is-falling hyperbole coming out of their camp. If you’re serious about it, you’d be in there talking to the people that are actually going to vote instead of on the airwaves and jumping up and down at hastily contrived press conferences.

So, one month later, let’s take a look at the clean energy landscape in Ohio. Were those of us opposed to SB 310 and HB 483 really just fear mongering to get our way, as the Ohio GOP has claimed? Would that this were true. In recent days, two major renewable energy companies have stated that they are delaying utility-scale wind installations, and they may end up scrapping the projects altogether.

On Friday, the Lima News reported that Iberdrola Renewables, the company that built the Blue Creek Wind Farm in western Ohio, has suspended work on both its Hog Creek and Leipsic Wind Farms. Hog Creek, which has already been approved by the Ohio Power Siting Board, would include 35 turbines, generating approximately 67 megawatts (MW) of electricity. Iberdrola is awaiting final approval for the Leipsic installation, which would have 75 turbines turning out 150 MW of power.

The next day, Everpower Renewables said that one of its projects, the Buckeye Wind Farm in Champaign County, may never get off the ground, despite the fact that the company has already invested millions in it. The project, which includes two phases, would see the company build roughly 100 turbines, producing enough electricity (200 MW) to power 50,000 houses. Buckeye would also generate $1.2 million in annual tax revenues, create more than 100 construction jobs, and offset 308,000 tons of CO2 each year. Yet, due to a lengthy legal battle and the knock on effects of these two bills, Everpower may have to abandon Buckeye entirely.

While it may seem unlikely that the bills would affect projects that have already been approved (particularly given the fact that the wind siting amendment in HB 483 grandfathered in such projects), that no longer appears to be the case. The way the law is written, the new, more restrictive siting requirements would kick in if any changes were made to a project’s scope of work. These changes could include utilizing a newer wind turbine model.

According to AWEA, Ohio ranked 26th in the country last year for wind power, generating 432 MW. These two bills could effectively derail projects that would generate a combined 417 MW, or 96.5% of this total. So much for the supposed hyperbole from SB 310 opponents. It may be easy to decry the other side as nothing more than another Cassandra, but we should remember one thing – Cassandra was right.

Tim Kovach, Northeast Ohio Sierra Club Executive Committee Member

How one unknown provision could destroy Ohio’s clean energy industry

Ohio Statehouse (courtesy of Wikimedia Commons)

By Tim Kovach

Tom Knox at Columbus Business First just outlined a little-known but incredibly significant part of SB 310 that will have wide-ranging implications for the future of Ohio’s clean energy industry.

From the post:

The bill would allow utilities under a renewable-energy contract to be released from the agreement “if there is a change in the renewable energy resources requirements,” according to the latest version of Senate Bill 310, passed by the Ohio Senate last week and being heard Tuesday in the House Public Utilities Committee.

If American Electric Power Company Inc. (NYSE:AEP), for example, signed a 20-year purchase agreement with a wind turbine company to provide some power for its customers, any future change in renewable energy requirements would allow AEP to void its contract.

While it would not affect existing renewable energy contracts, such as FirstEnergy Solutions’ deal to purchase power from the Blue Creek Wind Farm, it would apply to any new renewable energy contracts signed by one of the four investor-owned utilities after SB 310 becomes law. As Knox notes,

Without a two-decade guarantee of revenue, financial backers of wind projects would be hard-pressed to put up money.

“That is the ultimate done deal, it’s over, kiss all wind renewables gone,” said Jereme Kent, general manager of Findlay-based wind company One Energy LLC. “Even if wind was half the price, you could not sign a contract with that provision.”

With all of the attention surrounding the other God awful provisions in SB 310, including the two-year freeze and the elimination of the requirement that 50% of renewable energy is produced in Ohio, this small clause, buried on line 950 of the legislation (PDF), has been overlooked. Here’s the actual text in question:

Sec. 4928.642.  Every contract to procure renewable energy resources or renewable energy credits entered into by an electric distribution utility or an electric services company on or after the effective date of S.B. 310 of the 130th general assembly shall contain a change-of-law provision. Such a provision shall provide that the parties to the contract are released from their obligations under the contract if there is a change in the renewable energy resource requirements, governed by section 4928.64 of the Revised Code.

Without question, these 80 words inject so much uncertainty and chaos into Ohio’s burgeoning renewable energy industry that they may effectively strangle it in its crib. It’s hard to see any utility-scale renewable energy project getting financing when the utility can simply renege on its deal if any changes are made to SB 310 going forward.

Interestingly, this section was not included in the original form of SB 310 (PDF), as it was introduced to the Senate in March. Rather, someone slipped it in behind closed doors when the GOP leadership rewrote the bill last week.

Given the hands on-role that Governor Kasich played in changing the bill, I can’t help but wonder whether or not he was involved in inserting this section or was aware of it before the bill reached the Senate floor. Either way, the existing of this provision and the Governor’s apparent indifference (if not approval) for it clearly belies his supposed support for the 25,000 clean energy jobs in this state.

In his official statement with Senate President Faber last Thursday, the Governor claimed that SB 221’s standards “are now emerging as a challenge to job creation and Ohio’s economic recovery.” That could not be farther from the truth. The real challenge to job creation and economic growth is SB 310 itself.

The stakes just got even higher in this fight. You can no longer pretend to back clean energy and the jobs and economic development it creates if you support SB 310.

Fracking Series

NEO Sierra Club presents a series on fracking awareness in collaboration with West Shore FACT (Faith Communities Together for Frack Awareness).  The series of speakers and films is to be held at the West Shore Unitarian Universalist Church, 20401 Hilliard Blvd, Rock River, Ohio 44116.  Please join us for one or more of the following events, all of which are open to the public and free (though donations are greatly appreciated).

Nine-Part Series on Hydraulic Horizontal Fracking and the Viable Alternatives Available Now

THURSDAY,  SEPT. 12  @ 7 PM 
Alison Auciello, Ohio Organizer for Food and Water Watch
, will give an overview of fracking and the problems it presents.

THURSDAY,  SEPT. 19  @ 7 PM  
Dr. Deborah Crowden, MD,  will speak about the health impacts of fracking.

SATURDAY,  SEPT. 21  @ 7 PM  
Film screening: Triple Divide, a film by investigative journalists Joshua Pribanic and Melissa Troutman seeking truth about the impacts of fracking.

THURSDAY,  SEPT. 26  @ 7 PM  
Doug Shields, Pittsburgh councilman, talks about his successful campaign to ban fracking within city limits in 2010.

THURSDAY,  OCT. 3  @ 7 PM  
Dr. Lorry Wagner of  LeedCo, a regional non-profit and economic development organization, talks about the plans for an  offshore wind energy industry in Ohio.

THURSDAY,  OCT. 10  @ 7 PM  
Alan Frasz, President and principal owner of Cleveland based Dove Tail Solar and Wind, talks about the opportunities for solar energy in Ohio.

SATURDAY,  OCT. 12  @ 7 PM  
Film Screening: Bidder 70, a documentary of Tim DeChristopher who protested the leasing of thousands of acres of pristine Utah land to oil and gas companies as bidder #70.

THURSDAY,  OCT. 17  @ 7 PM  
Film Screening: Gasland II, filmmaker Josh Fox’s new sequel to his documentary, Gasland.

THURSDAY,  OCT. 24  @ 7 PM  
Teresa Mills, Fracking Representative with the Buckeye Forest Council, will talk about Ohio’s practice of disposing fracking waste in Class II injection wells and the problems with and alternatives to this practice.

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