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relates to Erdogan Faces Snub From Lawyers Boycotting Palace Ceremony relates to Hong Kong Resets Democracy Push With Peaceful Mass March in Rain relates to Kudlow Pushes Back on Recession, Says U.S.-China Calls Positive relates to Zimbabwe Police Ban Planned Protest Marches by Opposition relates to Gibraltar Says Can’t Seek Court Order Detaining Tanker for U.S. relates to Germany Says It Could Spend Extra $55 Billion If Crisis Hits relates to Singapore Must Stay Independent in U.S.-China Conflict, PM Says relates to Argentina Faces Fresh Turmoil After Resignation, Debt Downgrades relates to Johnson to Raise Brexit Stakes in Visits to Germany and France
politics

Contentious Ohio Nuke Subsidy Bill Heads to Governor’s Desk

Updated on

Contentious Ohio Nuke Subsidy Bill Heads to Governor’s Desk

  • FirstEnergy Solutions planned to close reactors without aid
  • Governor has said he would sign the nuclear legislation
The Perry power plant in Ohio. 

The Perry power plant in Ohio. 

Photographer: James Leynse/Corbis/Getty Images
The Perry power plant in Ohio. 
Photographer: James Leynse/Corbis/Getty Images

Ohio’s controversial bill to trim support for renewable energy and instead aid two struggling nuclear power plants is heading to the governor, who said he would sign it.

The state’s House of Representatives voted 51 to 38 Tuesday to approve a version of the measure passed by the Ohio Senate last week. It carves out $150 million a year to keep the reactors owned by FirstEnergy Solutions running while reducing support for wind, solar and energy efficiency.

Groups as diverse as the Sierra Club and Americans for Prosperity, the political organization backed by billionaire Charles Koch, have blasted the measure as a corporate “bailout.”

Ohio is the latest state to seek a way to support reactors battling to remain competitive as a flood of cheap natural gas drives down power prices. While New York, New Jersey and others are subsidizing nuclear power as part of strategies to fight climate change, Ohio would be the first to do so by directly yanking support from other environmental measures.

“If this bill passes, the solar and wind footprint in this state will shrivel,” Representative Sedrick Denson, a Democrat, said on the House floor before the vote.

Fossil Fuels Dominate

Most of Ohio's electricity comes from coal and gas

Source: U.S. Energy Information Administration

The legislation would support FirstEnergy’s Davis-Besse and Perry plants through a fee added to customer bills beginning in 2021. It would be offset by reducing Ohio’s clean-energy goals, requiring utilities to get 8.5% of their power from renewables instead of the 12.5% target now. The measure would also eliminate monthly surcharges to support energy efficiency measures.

FirstEnergy Solutions, which filed for bankruptcy last year, has said it would close the two power plants if the state didn’t provide aid. They employ about 2,200 people.

Shares of the company’s parent, FirstEnergy Corp., slipped less than 1% to $43.37 at 11:58 a.m. in New York.

The measure is expected to lower the average residential electric bill by $2.82 a month, starting in 2021, according to data prepared by the Ohio Legislative Service Commission.

In the long run, however, “keeping more expensive nuclear power units on line will increase wholesale electricity rates," said Josh Price, a senior analyst for Height Capital Markets.

The bill also provides about $50 million a year to support two coal plants operated by the Ohio Valley Electric Corp. and generate about $20 million a year for solar projects.

“The bottom line is this bill saves money, preserves jobs and protects Ohio’s environment,” Representative Jamie Callender, a Republican, said during a speech before the vote.

— With assistance by Millicent Dent

(Adds lawmakers’ comments, chart beginning in fifth paragraph.)