Ohio Manufacturers Back State Efficiency Standards

Efforts to dilute or eliminate Ohio’s Energy Efficiency Resource Standards represent an unfortunate – and risky – step backward for Ohio, according to results from an Ohio Manufacturers Association (OMA) study.

The standards, which were established with bipartisan support in Senate Bill 221 and took effect in July 2008, require electric utilities to help customers reduce power consumption through improved energy efficiency and aim to cut the state’s overall energy consumption by 22 percent by 2025 compared to 2009 levels. OMA calls the standards “a documented success” to date. They have helped customers across Ohio achieve savings on their electric bills while reducing all customers’ exposure to risks associated with the inherent price volatility of a competitive marketplace, according to Ohio’s Energy Efficiency Resource Standard: Impacts on the Ohio Wholesale Electricity Market and Benefits to the State, which was conducted in association with the American Council for an Energy Efficient Economy.

The study concludes that continued utility investments in energy efficiency; continued achievement of the current standards; and utilities bidding a portion of their energy efficiency resources equal to the savings required by the standards into regional capacity auctions through 2020, would yield direct and indirect savings of almost $5.57 billion for customers in avoided energy expenditures and reduced wholesale energy and capacity prices.

Energy efficiency is the lowest-cost resource for utilities to meet the demand for electricity, even during a period of abundant shale gas and low natural gas prices – and thus remains economically justifiable, the report says.

In March, The Plain Dealer reported that Ohio-based FirstEnergy Corp. had begun a behind-the-scenes push to get rid of the state energy efficiency standards that are denting its profits. The Akron power company sent a form letter to some of its larger customers asking them to fill in their name and send it to the Ohio Senate.

FirstEnergy defended its moves against the standards in a prepared statement: “FirstEnergy remains concerned that meeting the state’s energy efficiency goals will continue to place burdensome costs on our customers, particularly Ohio businesses.”

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