By Christen Smith

FirstEnergy Solutions said Monday it will extend the deadline for Ohio lawmakers to rescue its nuclear power plants along Lake Erie, after a late-stage concession to renewable supporters failed to win immediate support among state senators over the weekend.

Bankrupt FES said it was optimistic the state Senate will approve subsidies for the Davis-Besse and Perry nuclear facilities at its next session, scheduled for July 17.

The company said last August it needed a promise of state subsidies by “mid-2019, when FES must either purchase the fuel required for Davis-Besse’s next refueling or proceed with the shutdown.”

But FES spokesman Tom Becker said Monday that the company will bear the “financial burden” of missing a June 30 fuel purchasing deadline “given the expectation that the legislation will be passed in the coming weeks.”

“The company appreciates the hard work, support and commitment of House Speaker [Larry] Householder, Senate President [Larry] Obhof and Governor [Mike] DeWine to work toward final passage of HB 6 on July 17,” he said. “While FES is optimistic about the outcome for HB 6, the company remains unable to purchase the fuel required for Davis-Besse’s next refueling cycle without the certainty of critical legislative support. We remain on path for a safe deactivation and decommissioning. Should we receive the long-term certainty that comes with an affirmative vote within this time frame, we will immediately re-evaluate our options.”

The Senate Energy and Public Utilities Committee on Wednesday unveiled a modified House Bill 6 that would subsidize both nuclear and renewable energy generation, walking back House-approved language that gutted Ohio’s renewable portfolio standard and replaced it with fees for FirstEnergy’s nuclear facilities and two Ohio Valley Electric Corp. coal plants. Committee Chairman Steve Wilson (R) arranged for testimony on the revised bill over the weekend, but senators never took a vote.

Wilson told RTO Insider last month he was working to give FES an answer by Sunday. According to tweets about Saturday’s hearing, however, Wilson said he’d rather get the bill right than stick to the company’s timeline.

Dan Lushcek, a Senate staffer, told RTO Insider on Monday that the committee will consider a slew of other amendments to the bill before taking a vote.

“I know it’s Sen. Wilson’s intention to work on the plan and meet before the scheduled session on July 17,” he said. “Whether it’s just more hearings or an actual vote, I can’t say for sure.”

Some opponents of the subsidies contend the reactors are profitable and in no danger of retiring early, despite the company’s deadline for legislative action.

The amendment would direct 80 cents from each residential ratepayer’s bill — down from $1 in the House version approved in May — toward keeping the generators profitable amid a flood of cheap natural gas that has dragged energy prices down.

Commercial customers would pay $11/month (down from $15), and industrial customers would pay $240/month (down from $250), while large-scale customers would pony up $2,400 (down from $2,500). (See Ohio Plan Subs Nukes, Fossil Fuels for Renewables.)

The amended bill would also preserve a scaled-back RPS, the state law that mandates how much power electric distribution utilities (EDUs) procure from renewable resources. The Senate-proposed RPS requirement dropped from 12.5% of renewables by 2027 to 8.5% until 2025, with no continuation of the mandate thereafter. Lawmakers anticipated the new formula would collect $150 million in 2020 for the nuclear plants, but then it would be up to the Public Utility Commission of Ohio to determine if FirstEnergy needed the subsidies over the following six years.

The plan also cut the $2.50 fee assessed for the continued operation of OVEC’s coal plants to $1.50 and gave PUCO authority to reduce the rate even further, if necessary.

The changes did little to appease HB 6’s biggest critics, including the Ohio chapter of the American Petroleum Institute (API) and the Ohio Environmental Council Action Fund, which characterized the plan as a corporate “bailout.”

“While Senate leadership has started an important conversation about Ohio’s energy future, they are now headed in the wrong direction,” said Chris Zeigler, executive director of API Ohio. “This bill picks winners and losers at the expense of one of the most significant contributors to Ohio’s economic growth over the past decade: natural gas.”

He said 70% of residents oppose rescuing the plants and encouraged lawmakers to stick with the competitive electricity market framework, “which has brought cleaner air and more affordable electricity to Ohioans.”

Trish Demeter, chief of staff for the Ohio Environmental Council, said other tweaks proposed in the bill — including a provision that would prevent EDUs from taking a cut of the savings customers achieve through existing energy efficiency programs — diminish EE incentives. PUCO Chairman Sam Randazzo testified earlier this month that EDUs collected more than $233 million between 2014 and 2017 via these “shared savings.” (See Ohio Nuke Bill: A Worthwhile Tradeoff?)

“While on paper the renewable portfolio standard and energy efficiency resource standard are maintained … in practice these standards will effectively fade away,” she said. “This is due to … the likelihood that utilities would no longer cut energy waste through energy efficiency rebate programs.”

Demeter said the reduced OVEC fee is a step in the right direction but that the bill still lacks enough support for renewables.

“The new version of House Bill 6 is essentially a distinction without a difference and would drive the same conclusion if enacted — higher bills, dirtier air and Ohio jobs at risk,” she said. “As a state, we should lean into clean energy, instead of significantly dialing back policies that attract more investment in Ohio, cut energy costs for Ohio families and reduce harmful air pollution.”

The Ohio Consumers’ Counsel testified on Saturday that the new plan didn’t go far enough; only stripping out the OVEC fees entirely could make it more palatable, it said.

“Given the bill’s approach of subsidies instead of competitive markets, the Ohio Consumers’ Counsel continues to oppose the bill and the utility subsidy culture that it reflects,” said Michael Haugh, an OCC consultant. “I do appreciate the Senate’s truth in ratemaking where the bill no longer describes the OVEC plants as a ‘national security resource,’ which they are not.”

Haugh said a June 19 ruling by the Ohio Supreme Court underscores the risk of allowing FirstEnergy to collect fees disguised as funding for infrastructure support and investment. The court overturned a “distribution modernization rider” that PUCO assessed on customers in 2016 to upgrade infrastructure. Opponents, including the OCC, argued it was nothing more than a sham devised for “credit support.” The company collected $168 million annually from the rider, and the court said that without legislative action to the contrary, ratepayers won’t see any refund. (See Ohio Supreme Court Overturns FirstEnergy Subsidy.)

“The connection to HB 6 is that it was a subsidy, and the subsidy was for credit support that would relate in part to the troubled finances of the ultimately bankrupt FirstEnergy Solutions,” Haugh said, urging the committee to include language in the bill that provides a refund mechanism for customers. “It should have been a good week for consumers with the end of the charge, but it was a bad week for consumers with the court’s decision that FirstEnergy can keep the improper charges without a refund of nearly a half billion dollars to Ohio families and businesses.”