Ohio Senators weigh power programs that could move quickly, save money
Ohio Senators are thinking outside the box to encourage new power generation in the state. In a Tuesday committee hearing, they took up one bill establishing a community power pilot program and another allowing what’s known as virtual net metering.
Both approaches allow certain power customers to benefit from relatively small, privately financed power plants. But they accomplish that in different ways.
The pilot program is geared toward residential customers, while the virtual net metering program is reserved for mercantile customers like hospitals, manufacturers, and school systems.
As Ohio and other states wrestle with a power supply crunch fueled by data centers, supporters contend both ideas will help ease that pressure by getting new power online quickly. That promises lower bills for program participants, but also indirect benefits for the broader market.
Community power
The community power pilot has already passed the Ohio House. That bill, Ohio House Bill 303, directs state regulators to approve 1,500 megawatts of community energy projects around Ohio. The bill carries provisions to encourage development on brownfields and ensure facilities are spread throughout the state.
After four years, state regulators will prepare a report for lawmakers detailing the program’s impact, and then the General Assembly will be able to decide whether to continue, expand or scrap the idea.
The measure’s co-sponsor, Ohio state Rep. Sharon Ray, R-Wadsworth, emphasized the pilot program is structured to ensure costs aren’t shifted onto customers who aren’t participating.
“Community energy is the fastest way to bring additional power online through private investment, not additional riders passed on to the customer,” she said.
And to Ray, the program’s focus on small power facilities, makes it both nimble and resilient.
“Multiple smaller size, distributed generation facilities are more secure, less vulnerable to disruption, more reliable in aggregate, easier to repair, faster to build, and easier to site via local control at the municipal, township and county level,” she said.
Committee members asked about potential savings — anywhere from 10%-20%, Ray explained — and whether private investors are ready to pursue the idea.
“Oh, I think we will see private investment within the year if this bill passes,” Ray said. “I mean, people are ready to come in and start these programs immediately. You know, a lot of people believe solar will be the first, but that that doesn’t look like it may be the case — it may be biomass.”
Committee chair, Ohio state Sen. Brian Chavez, R-Marietta, pressed for Ray to come up with “some kind of success criteria that is tangible” at the front end, rather than relying on “where the winds are blowing in 48 months.”
Virtual net metering
Ohio law currently allows consumers to sell power back to their utility — from a home solar array for instance — to reduce their monthly bills. But the catch is that power source has to do be on or adjacent to the ratepayer’s property.
Ohio Senate Bill 298 expands that concept by allowing certain customers to strike deals with off-site power plants. The utility would then apply the power those plants produce to the specified customers’ energy bills. The only difference is where the power gets produced.
But the measure places strict limits on the program. Residential customers can’t participate, for instance. There are also significant restrictions when it comes to siting. Power plants must be built on rooftops, brownfields, landfills or former mines. The bill explicitly prohibits building on agricultural land.
But Kurt Princic from CEP Renewables said those restrictions might actually be a good thing. His company specializes in redeveloping distressed site like former landfills. Princic said Ohio’s brownfield program has been very successful, but at this point, the low hanging fruit is gone.
“What remains are particularly challenging sites, he said, “Senate Bill 298 offers a new option for these sites, which can bring billions of dollars of private investment into the state.”
Princic said CEP controls 15 sites that could collectively generate 210 megawatts of energy. And while those parcels generate less than $200,000 in local tax revenue right now, he estimated they could produce nearly $2 million for local governments through S.B. 298.
Committee members seemed particularly concerned about who bears the cost for connecting net metered power to the grid. Several speakers said the generator would be on the hook for those costs and they’d likely get baked into the rates they offer customers.
The proposal drew support from the Ohio Consumers’ Counsel, groups representing industrial and commercial power users and environmental groups. Spencer Dirrig from the Ohio Environmental Council Action Fund said their only suggestion would be to include retired coal plants among the sites eligible for development.
Like the community power pilot, net metering supporters emphasized speed, savings, and supply.
Testifying on behalf of the Ohio Manufacturers Association, John Seryak underlined the potential for net metering to reduce strain on the grid.
“Each project invested in, he said, “while good for the generation owner and the subscribing customer, would create room on the transmission grid for even more economic development in the state,”
Citizens Utility Board Executive Director Tom Bullock explained the program greenlights power producers who can move quickly.
“This is medium tier energy development,” he said. “Most of our discussion usually talks about base load, which is important, (but) takes a long time. It’s very expensive.”
In contrast, Bullock said, medium tier development, “is quick to market, and it’s cost efficient. So there’s a lot of benefits that we can position the state of Ohio and our consumers to take advantage of in this proposal.”