Break out your hip waders, people. Governor Strickland’s first crack at re-regulating Ohio’s energy industry just hit the legislature as Senate Bill 221, and the B.S. is knee-deep and rising.
The bill’s long, jargon-packed, and hard to understand, which shouldn’t be a surprise to anyone familiar with government’s attempts to extend its tentacles further into our lives. I know that legislation is mind-numbingly boring and makes your eyes glaze over. Believe me, I feel your pain. But if you’re worried about your electricity bill going up and yet you don’t want to experience the joy of rolling blackouts, you need to pay attention to this stuff.
Here’s a change to Section 4928.02 of the Ohio Revised Code that jumped out at me when I skimmed the bill (deleted text is struck through, added text is in boldface type):
Sec. 4928.02. It is the policy of this state to do the following throughout this state
beginning on the starting date of competitive retail electric service:
(A) Ensure the availability to consumers of adequate, reliable, safe, efficient, nondiscriminatory, and reasonably priced retail electric service;
(B) Ensure the availability of unbundled and comparable retail electric service that provides consumers with the supplier, price, terms, conditions, and quality options they elect to meet their respective needs;
(C) Ensure diversity of electricity supplies and suppliers, by giving consumers effective choices over the selection of those supplies and suppliers and by encouraging the development of distributed and small generation facilities;
(D) Encourage innovation and market access for cost-effective
supply- and demand-sideretail electric service including, but not limited to, demand-side management, time-differentiated pricing, and implementation of advanced metering infrastructure;
(E) Encourage cost-effective and efficient access to information regarding the operation of the transmission and distribution systems of electric utilities in order to promote both effective customer choice of retail electric service and the development of performance standards and targets for service quality for all consumers, including annual achievement reports written in plain language;
(F) Recognize the continuing emergence of competitive electricity markets through the development and implementation of flexible regulatory treatment;
(G) Ensure effective competition in the provision of retail electric service by avoiding anticompetitive subsidies flowing from a noncompetitive retail electric service to a competitive retail electric service or to a product or service other than retail electric service, and vice versa;
(H) Ensure retail electric service consumers just and reasonable rates and protection against unreasonable sales practices, market deficiencies, and market power;
(I) Preclude imbalances in knowledge and expertise among parties in a proceeding under this chapter to eliminate any appearance of disproportionate influence by any of those parties;
(J) Ensure that consumers and shareholders share the benefits of, as well as the responsibility for, electric utility investment in facilities supplying retail electric generation service;
(K) Provide coherent, transparent means of giving appropriate incentives to technologies that can adapt successfully to potential environmental mandates;
(L) Protect at-risk populations when considering the implementation of any new advanced energy technology;
(M) Encourage implementation of distributed generation across customer classes through regular review and updating of rules governing critical issues such as, but not limited to, interconnection standards, standby charges, and net metering;
(N) Facilitate the state’s effectiveness in the global economy.
What’s that warm and fuzzy bilge in part (H) about “just and reasonable rates”, you ask? Why, that means government-imposed price controls of course. Price controls cause shortages. Are you ready for brownouts?
I have no idea what part (J) is supposed to do. Consumers already benefit from utility company investments in new power generation facilities: they get more power produced more efficiently. As for “sharing responsibility”, consumers do that now by paying their electric bills, which helps to fund capital improvements by utility companies. So what new consumer “benefits” and “responsibilities” are we talking about here?
Parts (K) and (L) look like euphemistic ways of saying to utility companies: “We’ll make it crystal clear that if you don’t appease environmentalist wackos (including government officials), we’ll hurt your business.” Say hello to higher taxes and burdensome new environmental regulations. Such costs would normally be passed on to consumers in the form of higher rates, but with price controls that won’t happen now. Instead, these government-imposed costs will eat into the utility companies’ profits. If there’s no way to recoup the losses by increasing the rates charged to consumers, the power companies can’t provide enough power. Now throw in the other predictable effect of price controls on electricity: artificially high demand for power. What we’ll get is a repeat of California’s blackouts in 2001. Among sentient humans, this is commonly referred to as “a bad thing.”
I don’t understand the jargon in part (M). Can anybody translate it into plain English for me?
This is Ted Strickland’s idea of “improving” the production of electricity in Ohio. God help us.