The State of Ohio has had a good plan for encouraging renewable energy and energy efficiency. But now the State legislature is threatening to roll back this future-oriented plan. Commentator and University of Dayton professor Bob Brecha explains.
Since 2008, the State of Ohio has been operating under Senate Bill 221, our clean energy and energy efficiency portfolio standard. It mandates that Ohio obtain 25 percent of our energy from renewable and alternative sources by 2025. The targets included provisions for increasing the efficiency with which we use energy, and to position the State for a transition toward a more sustainable future energy system. At least, that’s what was supposed to happen.
Two years ago, the legislature passed a two-year freeze on the standards, with the explicit task of studying the impacts, and benefits, of the law. The Energy Mandates Study Committee created by Senate Bill 310 also was to recommend “the best evidence-based standard for reviewing mandates in the future.” On Sept. 30, the Committee released its final report with recommendations. Chief among them: an indefinite freeze on those standards, thus extending the reach of SB310.
With input from the Public Utilities Commission of Ohio (PUCO), the Committee determined average increased costs to consumers of the original standards. According to the calculations, the cost of alternative energy and energy efficiency programs worked out to about $3 -$5 per month for an average residential customer, a fairly small amount. But the Committee didn’t consider how reductions in energy use to households, industries and commercial enterprises due to the efficiency improvements would have reduced costs. The committee also failed to include societal benefits from reduced pollution due to the burning of fossil fuels. In fact, the benefits side of the “cost-benefit analysis” was ignored completely.
As evidenced in the recommendation to extend the SB310 freeze indefinitely, the main target of the Committee is actually the Obama Administration’s EPA Clean Power Plan (CPP), which the Committee severely misrepresented. The report’s authors claim that US EPA estimated costs due to the CPP will be billions of dollars in 2030. However, the cited cost is an estimate for the whole country, not just Ohio. Far worse, the benefits estimated by EPA for are five to ten times higher than costs, a point completely ignored by the Committee.
A key argument used by the study committee in making their decisions was that of increased costs of the green energy policies. Their analysis relies heavily on work by a think tank at Utah State University, a report that presents an extremely biased analysis. For example, it’s not at all clear that the think tank included an increase in jobs in the renewable energy and energy efficiency industries in their analysis, nor do they seem to take into account future increased costs of fossil-fuel energy or decreased costs of renewables.
One sign that there was a bias in the information given to the Study Committee is an estimate that the unemployment rate would increase by 10% due to the original renewable portfolio standard. A careful reading shows that this number refers not to future losses, but estimated past losses from the RPS. This would be worrisome, if it weren’t for the fact that the analysts essentially blame all negative economic consequences of the 2007-2008 recession on renewable energy standards. Their reasoning: since most state renewable portfolio standards came into existence between 2006-2010, and there was a recession in that time period, renewable energy must cause job losses. If this is indicative of the quality of analysis they rely upon, then our representatives have been severely duped.
Our representatives sitting on the study committee are doing a great disservice to the State of Ohio in recommending that the Renewable Portfolio Standard be frozen indefinitely. In the end, I fear that Ohio will be left behind by other states looking toward a future when we will be more efficiently using increasingly sustainable, locally produced sources of energy that create good jobs for Ohioans.
Bob Brecha is a professor of Physics and Renewable and Clean Energy at the University of Dayton, and Research Director at UD's Hanley Sustainability Institute. Follow him on Twitter: @BobBrecha
