In a move that provoked anger among some of his fellow Republicans in the state’s General Assembly, Ohio Gov. John Kasich (R) vetoed a bill that would have made compliance with the state’s controversial renewable energy mandate optional for the next three years.
Enacted in 2008, Ohio’s renewable energy mandate established goals and timelines for the state’s utilities to increase their use of wind, solar, and other non-fossil-fuel energy sources. Under the original law, FirstEnergy, American Electric Power, and other utilities were to derive 25 percent of their electricity from renewable sources by 2025, implemented gradually.
Growing evidence the requirement was raising the price of electric power to businesses and residents, making the state less competitive economically, prompted the GOP-controlled legislature in 2013 to scale back the statute’s original mandate to 12.5 percent of power from renewable sources by 2027. In 2014, Kasich and the legislature agreed to a two-year freeze on the mandate’s graduated increases.
With the freeze set to expire at the end of 2016, a lame-duck session of the legislature approved a bill, backed by utilities and major industrial users of electricity, essentially extending the freeze by making compliance with the mandate voluntary through 2019.
Kasich defended his December 27, 2016, veto by citing the state’s improved business climate, which he attributed in part to Ohio’s wide range of energy options made possible by the mandate.
Kasich’s veto was met with heavy criticism from state Rep. Bill Seitz (R-Cincinnati), who has been one of the state’s sharpest critics of the renewable energy mandate. Seitz argues extending the freeze is essential until the complicated legal situation surrounding Obama-era regulatory initiatives has been sorted out.
Like other states, Ohio is subject to former President Barack Obama’s Clean Power Plan (CPP), which sets stringent emissions limits for carbon dioxide from coal-fired power plants, along with other restrictions on energy production and use. The U.S. Supreme Court put implementation of the plan on hold until final decisions are issued in lawsuits brought by 27 states and the energy industry against CPP.
Following up on pledges he made during the 2016 presidential campaign to kill the Clean Power Plan, President Donald Trump is expected to cease defending the scheme in court and seek ways to scuttle it administratively. This regulatory uncertainty at the federal level complicates state initiatives designed to favor renewable energy at the expense of fossil fuels. The issue is particularly sensitive in Ohio, which the Energy Information Administration reported in 2016 received nearly two-thirds of its electricity from coal, 27 percent from natural gas, 14 percent from nuclear facilities, and just 1 percent from renewable sources.
“It is apparent Gov. Kasich cares more about appeasing his coastal-elite friends in the renewable energy business than he does about millions of Ohioans who decisively rejected this ideology when they voted for President-elect Trump,” Seitz said in an e-mail sent to news organizations immediately after the veto.
‘Full-Scale Effort’ to Repeal
Instead of convening a special session of the legislature to try to override Kasich’s veto, Seitz and his allies will attempt what his e-mail characterized as a “full-scale effort” to repeal the renewable energy mandate in 2017.
Joe Nichols, a policy analyst with the Buckeye Institute, says the renewable energy mandate may not survive another onslaught.
“Various energy issues are at the forefront of the legislature’s agenda this year,” Nichols said. “The renewable energy mandates were a late addition to a 2008 comprehensive energy bill, so it would be poetic justice for the mandates to make an early exit through a comprehensive energy bill in 2017.”
Isaac Orr, a research fellow at The Heartland Institute, which publishes Environment & Climate News, says Kasich’s veto is a setback for Ohio’s blue-collar workers.
“Natural gas production in the Utica Shale region has spurred investment in the manufacturing sector, a segment of Ohio’s economy that was devastated by the Great Recession,” Orr said. “Rust Belt poster children like Youngstown have begun to see investment in steel plants and ethane natural gas plants. These industries require vast amounts of energy, and the renewable energy mandate makes these businesses less competitive by increasing the cost of electricity to Ohio’s consumers and businesses.”
Bonner R. Cohen, Ph.D. ([email protected]) is a senior fellow at the National Center for Public Policy Research.
Randy Simmons, et al., “Renewable Portfolio Standards: Ohio,” Institute for Political Economy, Utah State University, April 2, 2015: https://heartland.org/publications-resources/publications/renewable-portfolio-standards-ohio