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Lanese Introduces Coal Plant Subsidies Repeal Bill

September 27, 2021
Laura Lanese News

COLUMBUS – State Representatives Laura Lanese (R-Grove City) and Reggie Stoltzfus (R-Paris Twp.) last Wednesday provided sponsor testimony on House Bill 351, legislation to repeal the Ohio Valley Electric Corporation (OVEC) portion of House Bill 6 from the 133rd General Assembly.

“The coal plants operated by OVEC have been losing money for more than a decade,” said Lanese. “The cost to Ohio consumers and businesses is projected to be more than $700 million. In addition to the unnecessary, yet astronomical direct costs of operating the two plants, are the indirect costs of market distortion, imprudent management and health care costs from the 1950s era coal plants. Whenever the government subsidizes an industry, it creates market inefficiencies and chases away investment from non-subsidized companies.”

Earlier this year, the House passed House Bill 128, which repealed the nuclear bailout portion of H.B. 6. Similarly, H.B. 351 will repeal the OVEC coal plant bailout portion of H.B. 6. 

H.B. 351 will achieve the following: 

  • Repeal, and expressly terminate, the non-bypassable rate mechanism applied to all Ohio ratepayers associated with contractual commitments related to a legacy generation resource established by H.B. 6 of the 133rd General Assembly.
  • Expressly prohibit any mechanism for retail recovery of costs for all specified generating facilities (the same as those defined as LGRs in H.B. 6), that was in effect on or before the effective date of H.B. 6, from being “revived, reimposed, reestablished, or in any way reinstituted” as a result of the bill, or by PUCO order, decision or rule.
  • Require that the full amount of revenues collected from customers under the LGR/OVEC provisions under H.B. 6 to be promptly refunded to customers from whom the revenues were collected and allocated to customer classes in the same proportion as originally collected.

“The coal plant subsidies from H.B. 6 must be repealed if we are to return to the free market principles of Senate Bill 3,” said Lanese.  “Not only will we restore much needed funds to our ratepayers, but we will also encourage further economic development when the market distortions are removed.”

The legislation awaits additional hearings in the House Public Utilities Committee.