June 19, 2017 Read More →

A Fresh Push by Ohio Utilities Seeking Bailouts for Old Power Plants

Cleveland Plain Dealer:

A power struggle has erupted in the Statehouse pitting Ohio’s traditional electric utilities against new independent power producers, as well as consumer, environmental and business groups wary of rate increases.

The outcome will have an impact not only on what consumers will pay for power in the future, but also on the state’s future economic development as businesses afraid of rate escalation leave the state or refuse to come to Ohio.

Led by FirstEnergy and American Electric Power, the utilities are pushing lawmakers to create new customer charges to help bankroll old nuclear and certain old coal plants.

Separate legislation authorizing the new charges that would cost customers billions of dollars over the next two decades have been working their way through House and Senate committee hearings in the face of stiff opposition from opponents.

The AEP-led proposal would add as much as $256 million to Ohio electric bills annually until 2040, or nearly $6 billion, according to an analysis by the Ohio Legislative Service Commission, to keep running two Cold War era coal power plants, one of which is in Indiana, that once made electricity solely for the defense industry. No Ohio electric customer could escape the surcharge, which has not been broken out by company.

The FirstEnergy charge would add about $300 million a year to the bills of FirstEnergy customers for at least the next 16 years to keep the company’s nuclear power plants out of red ink.

The company says individual bill increases would be limited to 5 percent, subject to periodic review by state regulators. But that cap does not include the cost of “deferrals,” that is, putting off collecting all of the money needed until a future time, when the company would add it to rates, with interest.

Opponents are calling the proposed enabling legislation “bailouts” of old, uncompetitive technology that should be allowed to die if it cannot compete.

Electric bill increases guaranteed in Ohio if certain legislation passes

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