Ohio Ignores the Evidence on Renewables

Got Science? | October 2014

While most U.S. states are experiencing a surge in renewable energy that exceeds even the rosiest predictions, one state—Ohio—has chosen this moment to backtrack. Earlier this year, Ohio Governor John Kasich signed a law that temporarily freezes the energy efficiency and renewable energy standards the state had adopted, choking investment in wind and solar, and stalling the state’s transition away from over-reliance on its aging coal plants.

Now, in the latest development, the Ohio state senate packed known opponents of renewable energy onto the review panel mandated to determine whether to make the current freeze permanent.

The latest move makes a bad situation worse—reducing the chance that Ohioans will get the fair evidence-based hearing they deserve about their energy future.

Gold standards

At the heart of the debate are two tools—renewable energy standards and energy efficiency standards—successfully  used by the majority of U.S. states.

Renewable energy standards require utility companies to produce a certain amount of the electricity they sell from renewable sources such as wind and solar. Now adopted by some 29 states, these standards are proving almost universally successful and popular, demonstrably bringing down carbon emissions, reducing air pollution, and helping to jumpstart a domestic clean energy industry.

Energy efficiency standards establish specific targets for energy savings that utilities must meet by developing programs that help their customers use energy more efficiently. Energy efficiency has long been recognized as the cheapest way to reduce energy costs and lower emissions and these standards are saving consumers money in every state that has adopted them.

Back in 2008, Ohio state lawmakers listened to the science and made a smart choice when a bipartisan majority initially passed a package of clean energy standards, including a renewable energy standard that required the state’s utility companies to deliver 12.5 percent of their electricity from renewable sources and an energy efficiency standard that sought to reduce energy use (compared to business as usual) by 22.5 percent by 2025.

As the data clearly show, the standards are working as intended, delivering real economic, environmental, and public health benefits to Ohio consumers.

Research at Ohio State University found that Ohio’s clean energy standards created some 3,200 jobs and save Ohio consumers over $300 million annually. The Ohio Environmental Council found that the standards saved consumers a combined $1 billion on their bills. And filings by Ohio's own utilities show the standards have been cost effective; the state’s energy efficiency programs have saved consumers two dollars for every dollar invested.

So what happened?

Ideology over evidence

Unfortunately, the Ohio legislature seems to have been swayed by a misinformation campaign waged by the fossil fuel and utility special interests. So, while the rest of the nation moves forward on building a low-carbon future and a next-generation electricity system with substantive contributions from energy efficiency and renewable energy sources, Ohio is doubling down on coal. It’s a misguided choice that will likely cost Ohio residents dearly in the long run.

Particularly disheartening is the polarization and tenor of the rhetoric in the debate. For example, among the panelists the Ohio Senate president named last month to rule on the future of Ohio’s renewable and energy efficiency standards is perhaps their most vocal opponent: State Sen. Bill Seitz from Cincinnati, a man best known in the state for denouncing renewable energy standards as a "Stalinist" government mandate.

If the panel nominees on the House side follow suit, Ohioans will almost certainly not get the science-based review that had been promised. That’s a shame because, especially when the evidence from around the country is considered, the case for renewable energy these days is a slam dunk.

Low carbon, fast growth

We need rapid deployment of renewable energy to lower the carbon emissions driving global warming and thereby forestall the most devastating climate impacts. That’s why the remarkable pace of growth in the renewable sector over the past several years is so heartening. Consider, for instance, the phenomenal growth of rooftop solar. Recent analysis from the Union of Concerned Scientists shows that the number of households with solar panels has increased more than tenfold since 2006, from 30,000 to 400,000 today. The latest government estimates project somewhere between 900,000 and 3.8 million U.S. households will have solar panels by 2020.

The remarkable pace of growth can also be seen for wind power. According to the U.S. Energy Information Administration, the electricity industry added some 675 MW of wind capacity in the first half of this year, more than double the amount added during the first half of 2013.

Falling prices

A key driver in the growth for wind and solar is that—thanks in no small measure to state renewable energy standards—their costs have plummeted and are projected to decline even further. For example, the average price of a solar panel has dropped almost 60 percent since 2011. The cost of generating electricity from wind dropped more than 20 percent between 2010 and 2012 and more than 80 percent since 1980. In areas with strong wind resources such as Texas, wind power generates electricity at least as cheaply as fossil fuels do. Rooftop solar is now as cheap as local electricity prices in 10 states and is projected to be at parity in more than half of all U.S. states by 2017.

Little wonder renewables account for the majority of new electricity-generating capacity built this year or that states such as Iowa and South Dakota already get some 25 percent of their electricity from wind power alone.

Spurring green jobs at home

But rapid adoption nationwide and falling prices are only a part of the bigger picture. A fair hearing of renewable energy standards would also need to consider not just how many energy dollars are spent, but where those energy dollars go.

For example, Ohio sent $1.2 billion out of state to pay for imported coal in 2012 alone. But renewable energy spurs investment and jobs in state. To see the effect in action, look no further than Massachusetts, a state that made substantial investments in wind and solar power over the past decade.

The Massachusetts 2014 Clean Energy Industry Report, released last month, found that the state’s clean energy industry continues to boom growing an impressive 47 percent since 2010 and now accounting for nearly 6,000 firms and more than 88,000 workers in the state. In fact, Massachusetts’ clean energy industry, barely visible a decade ago, is now a $10 billion sector that accounts for 2.5 percent of the gross state product.

Limiting carbon

If all these variables don’t illustrate how ill-considered Ohio’s latest energy choices are, there’s another part of the picture that makes the timing even worse for the state. According to the new rules proposed by the EPA in June limiting carbon emissions, Ohio power plants will have to reduce carbon emissions 28 percent by 2030 to comply.

The renewable energy and energy efficiency standards Ohio had put in place in 2008 would have given the state a strong start in complying with EPA’s proposed rules. But now, these tools have been taken off the table just when Ohio needs them most.

Sam Gomberg, energy analyst at the Union of Concerned Scientists, says that, in his recent selections for the review panel, Ohio Senate President Keith Faber has “stacked the deck” against renewable energy.

“When it comes to cost-effectively complying with the new federal carbon standards, Ohio’s latest decisions are akin to tying one hand behind your back before trying to swim across a river,” Gomberg says.

As he explains, no credible analysis shows that freezing, weakening, or rolling back Ohio’s clean energy standards will save consumers money. And, in light of the proposed EPA carbon rule, Ohio’s latest choices will almost certainly increase their electricity costs in the long run.

As the state considers its energy future, Ohio residents deserve a review of Ohio’s clean energy standards based on science and evidence, not misinformation and overheated rhetoric.

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