Ohio's Nonsensical Nuclear Bailout Moves Forward | Citizens Against Government Waste
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Ohio's Nonsensical Nuclear Bailout Moves Forward

The WasteWatcher is the staff blog of Citizens Against Government Waste (CAGW) and the Council for Citizens Against Government Waste (CCAGW). For questions, contact blog@cagw.org.


Like a giant pink bat signal, an inflatable pig owned by Bowling Green protestors drew attention back on Ohio’s proposal to bailout failing nuclear companies.

House Bill 6, introduced by Reps. Jamie Callender (R-Concord Township) and Shane Wilkin (R-Hillsboro) in April 2019 would provide taxpayer money to bail out FirstEnergy Corp., an Akron-based electrical utilities company.  FirstEnergy is in the process of declaring bankruptcy after numerous failed investments, which explains why they are begging the legislature for taxpayer-funded subsidies.  The original plan was to increase rates on electric bills—up to $2,500 a month for larger businesses. Beginning in 2020, the average home would have seen its bill increase by 50 cents per bill.  In the second year, the average home surcharge would have jumped to $2.50 per bill, and it would have gone up again the following year.  Meanwhile, the average business in Ohio was expected to see their electric bill go up by $20 a month.  However, as HB 6 made its way through the Ohio State House in May, revisions were made to the legislation that continue to prop up failing nuclear plants on the backs of taxpayers.

The proposal now includes a Clean Air provision to replace current clean energy subsidies with a $1 monthly charge on electric bills.  While the rollback of clean energy subsidies is certainly a plus, the money generated from the $1 monthly charge will go directly to FirstEnergy with the understanding that the company would use it to close their two defunct nuclear power plants in Northern Ohio: Davis-Besse in Ottawa County and Perry northeast of Cleveland.   Although they will be phased out by 2026, these subsidies would total $198 million per year and could go even higher.  As noted by Buckeye Institute Research Fellow Greg L. Lawson, “recovery of legacy RPS and Energy Efficiency costs, the cost of future Energy Efficiency programs authorized by the bill, and ongoing costs to support OVEC… could stick customers with additional charges.”

The two nuclear plants in question, Davis-Besse and Perry, cost on average, $11.77 per megawatt-hour of electricity more than all other nuclear plants.  This inefficient ratio of energy production explains why those plants are sinking. Both plants were commissioned over 30 years ago and still run on a system that only uses 4 percent of uranium before it turns to waste, resulting in a massive loss of potential energy. In comparison, modern nuclear plants harness between 33 to 37 percent of uranium’s energy.

Instead of propping up dying nuclear plants, the Ohio legislature should focus on allowing the market to run its course without government intervention or a taxpayer-funded bailout.

-- Ganon Evans

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