COLUMBUS, Ohio -- Financial protection for
consumers and the development of alternative energy sources were at the
heart of Gov. Ted Strickland's long-awaited energy plan released
Wednesday.The stabilization of electricity rates and the
development of new resources is vital to keeping jobs from leaving Ohio
for states with lower rates, Strickland said.Strickland also
wants a minimum of 25 percent of electricity sold in Ohio by 2025 to be
generated by what he calls "advanced energy technologies."
Those include clean coal, new nuclear power technologies, fuel cells
and renewable energy sources such as wind, water and solar power.
Ohio
lawmakers passed an electric deregulation law in 1999 aimed at allowing
competition between suppliers and lowering customers' bills.The
law required a transition period with frozen distribution rates for big
utilities and a 5 percent discount on generation to allow the market to
develop.However, competition never developed because no one has been able to beat what utilities now pay for power.
The
Public Utilities Commission of Ohio has continued to regulate the
distribution and transmission of electricity to customers.But
rate stabilization plans are set to expire at the end of 2008 for
Akron-based FirstEnergy Corp., Columbus-based American Electric Power
Co. and Duke Energy Corp., which supplies power in southwest Ohio.
Dayton Power & Light Co.'s plan expires in January 2010.
Strickland
said the state must step in again to prevent price spikes once the
stabilization period ends. He noted Illinois, where rates increased up
to 50 percent once competition became a reality, and Maryland, where
rates shot up 72 percent. Strickland said it's too early to determine
what the impact would be on residential rates in Ohio.
"We cannot
let happen (in Ohio) what happened in Maryland and what happened in
Illinois," Strickland said at a briefing for reporters.
PUCO
would sign off on any plans by electric utilities to change rates in
Ohio. The panel also has the power to approve a utility's decision to
bring competition to the sale of power.
Many groups have offered
solutions to the problem, including those of industrial and commercial
users that wanted a return to strict regulation by the state.
FirstEnergy,
which provides power to more than 2 million customers in northern Ohio,
agrees that keeping jobs in Ohio is important but has concerns about
cost, especially the plans to produce clean coal and add more nuclear
power, spokeswoman Ellen Raines said.
She
said the technologies for
those energy sources are in their infancy."We don't know how that
squares with rate stability. All of those items have significant price
tags," Raines said.
Erin
Bowser, executive director of Environment Ohio, a nonprofit advocacy
group, said her group would have liked more emphasis on "clean"
renewable energy, such as wind and solar power.
"Because we have
lumped coal and nuclear power into this plan, we are continuing to not
give the lift we need to renewables to develop," she said.
Some
of Strickland's ideas would save customers money, said Ohio Consumers'
Counsel Janine Migden-Ostrander, whose office represents residential
customers in rate cases.
However, she has concerns about some of
the ways utilities could increase rates by passing on the cost of new
plants and pollution control equipment.
Strickland would like
legislation on his plan completed by year's end. If the plan clears the
Republican-controlled state Legislature, the Public Utilities
Commission of Ohio would have to find a way to implement it.
"It is my hope that we would deal with this expeditiously," Strickland said.
Republican leaders in the Legislature were noncommittal in their response to Strickland's plan.
"We
appreciate the work the governor and his staff have put into organizing
their thoughts on energy policy," House Speaker Jon Husted of Kettering
and Senate President Bill Harris of Ashland said in a statement.
"We
look forward to receiving the proposal in bill form and evaluating its
ramifications.
"While much work remains, Strickland took an
important first step Wednesday, said Sam Randazzo, a lawyer who lobbies
for Industrial Energy Users-Ohio, the utilities' biggest customers.
"Ohio
needs to deal with the mismatch between expectations that existed and
what we are actually contending with today," Randazzo said. "The one
thing that's positive is the governor has identified this issue as
important for the state. ... Shame on us if we can't get it done from
here."
