Don’t Use Hidden Taxes for Solar Power
The wind and solar developers who supported Ohio’s energy portfolio mandates and used hidden taxes in utility bills to fund their pet projects have been quick to attack anyone who suggests they may have gone too far.
That attack came to Ohio recently when the Public Utilities Commission of Ohio (PUCO) ruled against a proposal that would have imposed a $357 million “tax” on American Electric Power (AEP) customers to subsidize a 49.5 megawatt (MW) solar project called Turning Point. Based on the evidence, the PUCO ruled that forcing customers to pay for Turning Point was not necessary in view of the fact that sufficient supplies of solar-generated electricity were readily available in Ohio. Following the decision, party officials, the “mandaters” and some newspapers attacked the PUCO’s decision. Though predictable, their attack is short-sighted and fails to bring much needed attention to the anticompetitive, anti-solar and anti-consumer effects of Turning Point.
The claim that Turning Point is needed to satisfy the solar mandates assumed that without Turning Point there would not be enough solar electricity production in Ohio. The reality is very different. Thanks to the voluntary efforts of hundreds of residential, commercial and industrial customers throughout Ohio, there is plenty of solar electricity production in Ohio without Turning Point.
In 2012 alone, voluntary choices by hundreds of Ohio citizens have produced over 33 MW of new solar electricity generating projects which have been certified by the PUCO as renewable energy resources. Each megawatt hour from these consumer-driven solar facilities yields a solar renewable energy certificate (SREC) which can be sold to help cover a portion of the cost. As a supporter of Turning Point recently acknowledged, Turning Point would mean that the “…SREC prices will almost certainly plunge to ‘junk’ status once the project is complete which will hurt solar developers…” elsewhere.
The PUCO’s approval is not required to build Turning Point. The proponents of the project could have moved forward in October 2010 when it was announced. They claim that Turning Point can stand on its own in the competitive market without the benefit of a new consumer tax. Yet they continue to attack the PUCO for not helping them raise electric bills so that Turning Point’s developers don’t have to obtain funding support the old fashioned way – by earning it.
Solar investment is alive and well in Ohio thanks to the “customer choice” structure of Ohio law that includes “net metering” and streamlined interconnection rules. As the PUCO found, Turning Point is not needed. And, had the PUCO found otherwise, it would have hurt consumers and the hundreds of Ohioans who were investing in solar while Turning Point’s proponents were pushing for more government mandates and more hidden taxes in utility bills.
McNees Wallace & Nurick LLC