Last-minute changes in Ohio budget bill favor hydrogen and nuclear energy

The 6,198 pages of the two-year budget passed by Ohio legislators on June 30 contained policies for new utility fees, natural gas, nuclear energy promotion, and solar power. Line item vetoes, released in the early hours of July 4, modified some terms.

Ohio’s budget bills for two years have become a massive, catch-all bill in recent times. This has been criticized as a lack transparency. The legislators don’t have to reveal who was behind the various amendments. This is especially true for those added during conference committee discussions. Committees that are experts in energy, education, and other topics do not discuss changes in policy. The public is given few or no chances to give testimony on certain revisions.

Kent Smith, D, Euclid, said that Ohio has a long history of making bad decisions on energy in bills which don’t receive much sunlight. Often, these are budget bills. He cited the tripling in Ohio’s wind-turbine setbacks for 2014, which had not been subject to committee testimony.

The new House Bill 33 contains a number of changes in energy policy.

For now, there are no new charges for utilities that invest in speculative infrastructure.

Gov. Mike DeWine vetoed line items that would have allowed utilities to recover money for infrastructure extensions at sites that may or may not attract new businesses. The bill’s language would have allowed the Public Utilities Commission of Ohio to determine whether the electric utilities were able to recover money from ratepayers, or through an All Ohio Future Fund. The fund’s terms would also have allowed it to pay for gas infrastructure.

The issue is likely to come up again. DeWine said in his veto that his administration supports creating a strategy for extending natural gas and electricity to high priority sites before an end user.

Bruce Weston, Ohio Consumers Counsel, said that the governor’s veto “protected customers by preventing a new subsidy for electric utilities.” Both the Office of the Ohio Consumers’ Counsel as well as the Ohio Manufacturers’ Association were against the proposed terms.

Hydrogen hubs and blending can be included in the natural gas infrastructure charges.

The Public Utilities Commission of Ohio can now include charges for connecting to hydrogen facilities, which enable it to be blended with natural gas.

Fuel cells that use hydrogen do not produce greenhouse gases, and they are generally more energy-efficient when compared to burning natural gas. Some critics also question whether the so-called “blue hydrogen hubs” that produce hydrogen by using natural gas, and then sequester the carbon emissions that result from this process will actually lower emissions and costs. blending hydrogen with methane is more controversy .

The budget bill allows gas companies to charge ratepayers for infrastructure using a mixture of hydrogen and methane, a fossil-fuel. Dave Anderson, the policy and communication manager at Energy and Policy Institute said that this is not clean energy. “HB 6 has rolled back state programs that supported renewable energy and efficiency.

The state’s oil-and-gas well fund, which has a budget of $220 million, could be transferred to the general revenue account next year instead of being used for plugging wells.

The lawmakers would have protected Ohio’s oil and natural gas fund from transfers up to $220,000,000 if Ohio’s general revenue fund needed the money by 2025. DeWine’s line-item vetoes eliminated the exclusion.

The money in the fund comes from the small severance taxes that oil and natural gas producers pay. It is intended to clean up 36,000-66,000 abandoned and orphaned oil and gasoline wells across the state. Ted Boettner said this as a senior researcher at the Ohio River Valley Institute. The cost of cleaning up these wells is estimated to be between $3 billion and 6 billion dollars. More wells may be abandoned over the next few decades.

Boettner stated that using special revenue funds for budget balance instead of their intended purpose – to clean up the well sites – will harm the oil and gas workers who depend on these jobs to earn a living.

The new Ohio Nuclear Development Authority has slightly less power.

The Ohio Senate cut provisions for a Ohio Nuclear Development Authority that had failed to pass during three previous legislative sessions. The bill that was passed on June 30, however, included these provisions.

“That is the power of the Conference Committee.” “Very disappointing,” said Terry Lodge, a lawyer who had opposed the provisions.

DeWine vetoed specific items, which cut down on terms that would allow the new authority to enter into agreements and contracts with federal agencies. The vetoes eliminated a separate committee which would have chosen candidates to fill the nine-member authority.

The terms that limit legal liability of liquefied gas suppliers have been withdrawn.

DeWine’s line-item vetoes have slashed the terms that would have exempted liquefied gas suppliers from civil liability claims, except in cases of intentional misconduct. DeWine’s message on his vetoes said that the terms would have changed Ohio’s law regarding product liability for a specific industry by “absolving” it of some causes of action, and a meaningful duty of caring.

The PILOT program for solar projects has been extended.

The budget law extends the Payment in Lieu Of Taxes (PILOT), for utility-scale projects that include solar energy and other eligible energy sources, for four more years. The PILOT program allows project developers to work with local communities and provide packages of financial benefits in lieu of any property tax payments due.

The new law reduces the percentage of workers for solar projects who must reside in Ohio to be eligible for the program from 80% down to 70%. The percentage for non-solar project remains at 50%.

A second provision would have allowed developers to include workers who lived across state borders as long as they were members of an Ohio union. DeWine used his line item veto in order to remove the out-of state exception.