14-May-12 Ohio Energy Reform Likely Before Summer 

Relief from potentially significant electricity cost spikes for Ohio businesses appears to finally be on the horizon with Senate passage last week of Senate Bill 310. SB 310 hits the pause button on Ohio’s five-year old renewable energy and energy efficiency mandates and establishes a process for the legislature to further consider the impact of these mandates on job creation and our economy.

The mandates require annual increases through 2025 in both electricity efficiency and the amount of power generated from renewable sources. Ohioans have already paid nearly a billion dollars to comply with the costly law, and forecasts suggest the growing benchmarks mean ratepayers could be paying over $500 million per year by 2020. Business groups have been encouraging the General Assembly to adopt changes that would make energy efficiency more achievable without exponentially increasing consumers’ electricity costs.

SB 310 accomplishes this by suspending for two years further increases in the benchmarks and creating an Energy Mandates Study Committee. The committee is charged with conducting a cost-benefit analysis of the mandates, identifying an evidence-based standard for reviewing them, and recommending changes for subsequent legislation.

The bill also contains other positive changes that will give employers some protection against escalating compliance costs in the meantime. It permits a variety of policies, practices and programs that save energy to actually count toward achievement of the mandates, streamlines the existing process available to energy-intensive customers to opt-out of paying for the mandates, and provides additional transparency by requiring that electric bills reveal just how much mandate tax they contain.

SB 310 is a necessary step on the path to finding a permanent solution, and the chamber applauds the Senate for passing it, along with bill sponsor Sen. Troy Balderson, Senate Public Utilities Committee Chair Bill Seitz, and Senate Pres. Keith Faber for their leadership in addressing the issue.

The bill is scheduled for two hearings this week in the House Public Utilities Committee, and Speaker of the House Bill Batchelder has signaled his intent to ensure the bill passes before the end of the month. Gov. John Kasich also issued a supportive statement that underscores how Ohio’s energy mandates are emerging as a challenge to job creation and our economic recovery.

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