Generators, business groups line up against Ohio nuclear bill

Dive Brief:

Backers and opponents are squaring off over a bill in Ohio that aims to provide financial support for FirstEnergy’s nuclear plants.
Opponents include AARP, the Ohio Manufacturers’ Association, the Ohio branch of the American Petroleum Institute, the Alliance for Energy Choice, and the Electric Power Supply Association, a generator trade group. They say the subsidies would only serve to prop up FirstEnergy's bottom line and oppose undue costs on consumers.
Backers include the International Brotherhood of Electrical Worker Local 245 and FirstEnergy, who argue the plants are essential for the state's economy and local tax bases.

Dive Insight:

Measures to shore up nuclear power plants have been put in place in New York and Illinois and are under consideration in legislatures in Connecticut, Ohio and New Jersey.

And in all instances they have encountered resistance.

Non-nuclear generators say the measures in Illinois and New York will distort the economics of wholesale power markets. PJM Interconnection has also weighed in. In a March filling in federal court, PJM’s independent market monitor said Illinois zero emission credit (ZEC) would violate federal law.

A bill in Ohio, called a zero emission nuclear resource (ZEN) program, would provide emissions credits for FirstEnergy’s three nuclear plants.

Sen. John Eklund (R), the bill’s sponsor, says the continued operation of those nuclear assets is “critical to the economic health of Ohio, and especially to the communities in which they are located.”

The IBEW takes a similar view, focusing on the livelihood of the 517 union workers at the plants, as well as the “thousands” of union contractors who depend on the plants.

But independent generators groups, such as EPSA, argue that bill would first and foremost improve the bottom line of FirstEnergy and distort price formation in organized markets.

The Ohio Manufacturers’ Association takes a similar line, arguing that the bill would allow FirstEnergy to prop up its business on the backs of Ohio consumers.” The group says it supports nuclear power as part of an all-of-the-above approach but calls the bill, SB 128, a “wolf in sheep’s clothing.”

AARP cites the opposition similar measures have attracted and calls them “scams” because they interfere with the working of wholesale energy markets.

The Federal Energy Regulatory Commission is due to address that market question in a technical conference at the beginning of next month focused on state generation subsidies.