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Opponents of Ohio’s Renewable Energy Standards Say Study Shows They’re Costing Consumers

Wednesday, February 19, 2014 at 5:22 PM

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After a three-month break, the controversial bill to revamp the state’s energy standards is back. And as Statehouse correspondent Andy Chow reports, it’s coming with the momentum of a new study that says if changes aren’t made, utility customers could pay a lot more.

The controversial bill to revamp efficient energy policies in the state has stirred up a core debate: Are Ohio’s current programs and standards saving money for consumers?

A new study says Ohioans are spending more money than they’re saving. That’s according to Dr. Jonathan Lesser, an economist with more than 30 years’ experience in the energy industry.

With the subsidies and programs, Lesser says at best, an average Ohio household is saving 37 cents on their monthly energy bill. This means consumers are paying five to 10 times more than any possible benefit.

“So if you look at the cost-benefit side, you’re saying for every dollar of benefit I have to pay $5 to $10,” Lesser said. “It’s like getting a store coupon that says, ‘You can get a dollar off, but it’ll cost you $5 for that store coupon.’ Not a very good deal.”

Other studies have claimed that the current policies are suppressing costs and switching to the changes proposed in the current energy legislation would make utility bills go up.

According to a calculation by the Office of the Ohio Consumers’ Counsel, if the Senate bill were to pass, the state’s four million households would pay on average as much as $520 more over a utility’s three-year energy efficiency plan.

And a study from Ohio State University, in partnership with Advanced Energy Economy Ohio, says the renewable and efficiency standards have saved ratepayers 1.4 percent on their energy bills.

Lesser says it’s hard to know exactly how OSU arrived at that number because they have not disclosed all the variables that went into their model. He added that the assumptions that were disclosed raised red flags for him.

“If this model has this kind of obvious error, and I can’t test it otherwise—I can’t see the assumptions and data they’ve used to put together and test it because they won’t share it—then I wouldn’t rely on that model whatsoever for policy purposes,” Lesser said.

Lesser says the proposed energy bill would help by making it less onerous for utilities to comply with the standards. His study was commissioned by Ohioans for Sustainable Jobs, a coalition that includes the Ohio Chamber of Commerce and Industrial Energy Users of Ohio. The coalition is in favor of the energy bill.

The Ohio Consumers’ Counsel is reviewing the results of Lesser’s study, but says they continue to worry that the energy bill will make sure utilities profit at Ohioans’ expense.

Andy Chow at the Ohio Public Radio Statehouse News Bureau. 

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Energy, Government/Politics

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