COLUMBUS — One “expert” told Ohio senators Tuesday that the two nuclear power plants on the shore of Lake Erie are profitable and will not have to close prematurely even if consumers aren’t forced to bail them out.
Another “expert” countered that this study cherry-picked its data but argued that, either way, Ohio can’t afford to lose the Davis-Besse plant east of Toledo, and the Perry, Ohio, plant east of Cleveland as other states prop up their own plants.
It’s crunch time for the state Senate if it is going to try to get a bill to Gov. Mike DeWine’s desk before summer recess, most likely by June 30.
Sen. Steve Wilson (R., Maineville), chairman of the Energy and Natural Resources Committee, said the chamber may split the issue, forging ahead with a bill addressing the nuclear question while leaving debate on the future of renewable power for another day.
That would gut House Republican arguments that the final result would be a net decrease in customer bills once charges associated with the renewable mandates are removed.
“I have had FirstEnergy Solutions sitting in front of me at my desk and tell me they need to have an answer on the nuclear by June 30,” he said, noting that the House just last week passed House Bill 6.
“With the time constraints that are before us and all the questions that seem to loom around it, we need to begin to learn, study, ponder, and think, and figure out a way forward,” Mr. Wilson said.
House Bill 6 passed the lower chamber by a vote of 53-43, with most Republicans supporting it and most Democrats in opposition.
FirstEnergy Solutions has said it must decide soon whether to order fuel for Davis-Besse or proceed with plans to close the plant by May 31, 2020. Davis-Besse directly employs about 700 people.
As now written, the bill would impose surcharges on electric customers across the state — ranging from $1 a month for residential consumers to $2,500 for big industrial users — to ultimately create a fund of $198 million a year through 2026. The fund would provide $9 for each megawatt hour of power produced without emitting carbon dioxide into the air.
The two nuclear plants would receive most of that fund, some $150 million or more. Operators of five major solar fields already approved by the Ohio Power Siting Board may also participate in the Ohio Clean Air Program.
Wind, smaller solar projects, and other renewable sources of electricity would be shut out of the fund, and the current mandate in law that utilities find 12.5 percent of their electricity from renewables by 2027 would be repealed.
Dr. Paul Sotkiewicz, a Florida economist hired by the American Petroleum Institute, told the committee that, despite statements to the contrary by FES, the two plants have been able to cover their operating costs and should be expected to continue to do so for the next 10 years.
“Ohio’s nuclear resources are in no danger of retiring anytime soon in spite of the deactivation notices provided to PJM [the 13-state regional grid coordinator] and to do so would not be economically rational and [would] financially harm the shareholders in those assets,” he said.
But Ray Gifford, a former Colorado state utility regulator brought in by FES, said his first instinct would not be to recommend nuclear subsidies.
“But I see no good alternative, and these plants are too vital to Ohio to sacrifice because of the failures of a distorted regional wholesale market,” he said. He noted some other states have adopted some form of nuclear subsidies to keep their plants alive.
“In the end, you end up with collective action problem where states that do not subsidize their failing nuclear units end up being chumps who forgo the power, the resilience characteristics, the jobs, and tax revenue,” Mr. Gifford said. “By contrast, states that do adopt [zero-emission credit] programs keep their plants. So, I am here to urge Ohio not to be chumps who lose their nuclear units while other states preserve theirs.”
The bill also adopts and expands on court-ordered support for a pair of 1950s-era coal-fired plants owned by the multi-utility Ohio Valley Electric Corp., one of which is located in Indiana.
First Published June 4, 2019, 8:04 p.m.
