This fall’s election for three seats on the Supreme Court of Ohio is expected to play a pivotal role in deciding the state’s direction on renewable energy, utility accountability and other energy issues.

In addition to deciding appeals from lower courts dealing with energy and other topics, the seven-member Supreme Court of Ohio hears all challenges to cases from the Public Utilities Commission of Ohio and Ohio Power Siting Board. The commission broadly decides what utilities can do and how much they can charge ratepayers, while the siting board approves where energy generation and other infrastructure get built.

Judicial candidates do not campaign on issues, so voters won’t have a full picture of how they are likely to rule on energy-related cases. However, endorsements, campaign contributions, and a handful of decisions by incumbents offer some clues. 

The Ohio Environmental Council Action Fund has endorsed all three Democratic candidates — Michael Donnelly, Melody Stewart, and Lisa Forbes. Donnelly and Stewart are incumbents seeking another six-year term. Forbes is an appellate judge in Cuyahoga County, which includes much of greater Cleveland.

Meanwhile, the Ohio Oil and Gas Association and NiSource have given money to the campaigns of all three Republicans —Joseph Deters, Dan Hawkins, and Megan Shanahan. American Electric Power also gave money for Shanahan’s and Deters’ campaigns, data compiled by Open Secrets show. 

Deters was appointed by Gov. Mike DeWine last year to fill a partial term and is challenging Stewart for a full term. Hawkins and Shanahan are trial court judges in Franklin and Hamilton Counties, respectively. 

Ideally, party jurisdiction should not matter when candidates run for judicial office, said Heidi Gorovitz Robertson, a law professor at Cleveland State University. And some past energy rulings have been unanimous, including a 2021 ruling reversing a PUCO decision favoring a FirstEnergy affiliate while Sam Randazzo was chair. 

Starting in 2022, however, a new state law added party affiliations on fall election ballots for appellate court judges. Republicans hold a 4-3 majority on the Ohio Supreme Court, but that balance could flip depending on the outcome of this election.

These are some of the energy issues the new court is likely to take up in the coming years:

Who gets the biggest say in where solar farms are built?

The Ohio Supreme Court still has to hear oral arguments and then decide solar farm siting cases for the Kingwood Solar and Birch Solar projects. Supporters of the projects argue the Ohio Power Siting Board acted unlawfully by treating the volume of local opposition as a deciding factor, rather than considering whether the substance of the objections outweighed other factors supporting the projects.

“How the judges approach those questions is going to have a big impact on how renewable energy projects move forward in this state into the future,” said Chris Tavenor, an attorney speaking on behalf of the Ohio Environmental Council Action Fund.

If the court sides with the siting board, it could give local opposition groups more sway in project siting than a 2021 law already grants to county governments. The result could further empower groups with links to fossil fuel interests, which sometimes stoke fears about renewable power to build opposition.

The Kingwood case docket includes a friend-of-the-court brief filed on behalf of the Ohio Senate’s Republican majority, which was written as if it came from the whole Ohio Senate. Ohio Attorney General Dave Yost then moved to strike a separate brief filed on behalf of the seven Democrats in support of the project. An August 7 ruling denied Yost’s motion, but Deters dissented and would have denied the Democratic Caucus a say in the case.

How long can regulators make developers wait for decisions?

Another case, Moraine, presents ongoing questions about the timing of Supreme Court appeals. In Moraine, the court let an energy consulting company appeal several PUCO decisions about out-of-state renewable energy credits, in essence taking the commission to task for delays in deciding the company’s request for it to reconsider the rulings. 

The court’s August 27 procedural ruling said the PUCO can’t avoid its legal duty to rule on rehearing requests within 30 days by giving itself more time. Donnelly agreed with the ruling, Stewart dissented, and Deters didn’t take part.

On one hand, the ruling should speed up renewable energy cases and maybe let developers get projects built more quickly. The ruling should also shorten how long consumers may have to pay contested charges that may ultimately be ruled unlawful.

On the other hand, the ruling on timing represents a shift in the law. The Ohio Power Siting Board’s arguments in an earlier Kingwood Solar appeal were very similar to those the PUCO made in the Moraine case. Yet in September 2023, six judges, including Donnelly, Stewart and Deters, agreed to dismiss the earlier Kingwood Solar case.

On September 4, the PUCO held the new Moraine ruling means rehearing requests in other cases were denied by law and suggested the time for any appeal has passed. An October 2 ruling repeated that position. 

“Instead of embracing the court’s pro-consumer ruling, the PUCO is undermining it,” said Ohio Consumers’ Counsel Maureen Willis.

Will utility customers ever get refunds for unlawful riders?

An AES Ohio case aims to block more than $150 million in refunds for allegedly unlawful “stability charges” that the PUCO said would be refundable “to the extent permitted by law.” The utility had gone back to the old subsidy rider after a later one was ruled unlawful. 

AES is also trying to use the August 27 Moraine ruling to say the Ohio Consumers’ Counsel missed its opportunity to appeal in any event. 

“AES’s latest move to avoid giving refunds to its 500,000 consumers should meet with sound defeat,” Willis said. “To protect consumers, the court should proceed to oral argument and allow justice to run its course.”

The case will test the limits of language about refunds in a 2019 case, which held FirstEnergy’s so-called distribution modernization rider was unlawful. Donnelly’s opinion there said no refund was available for the money already paid, because the PUCO hadn’t made the rider refundable. Stewart was among the judges who agreed.

What penalties will FirstEnergy face for its role in Ohio’s HB 6 scandal?

A review of those rider charges is now among four FirstEnergy cases before the PUCO relating to the ongoing House Bill 6 corruption scandal. An evidentiary hearing on another of the cases dealing with corporate separation is set to start this month. The rider review and the other three cases will likely have hearings next year.

Hundreds of millions of dollars are at stake. Charges in at least one case may be refundable through future bill adjustments. And even if consumers don’t get refunds in the other cases, FirstEnergy could be liable for penalties. So, some or all of the cases will likely end up at the Ohio Supreme Court.

Deters recused himself from a case last year in which the court let the Ohio Attorney General’s office seize assets of former PUCO chair Sam Randazzo. Although the notice didn’t say why, Deters previously worked with lobbyist Matt Borges, who was convicted last year on federal criminal charges related to HB 6. Deters also has sat out several appeals from the PUCO, where his brother is a commissioner. 

Will drilling continue to be allowed under state parks and wildlife areas?

Natural gas cases could also end up at the Ohio Supreme Court. One case challenges the constitutionality of a 2023 law that labeled natural gas “green energy” and jump started regulatory action to allow drilling and fracking under state parks and wildlife areas. Briefing ended last year. The trial court has not yet made its decision.

Another case seeks to challenge instances in which the Ohio Oil and Gas Land Management Commission decided to solicit bids to lease areas under specific state parks and wildlife areas for drilling and fracking. The trial court dismissed the appeals in February. The case is currently on appeal.

Whether either case goes to the Ohio Supreme Court isn’t a foregone conclusion. Much will depend on how the courts rule, said Megan Hunter, an attorney with Earthjustice who represents several environmental groups in the cases.

Judging the judges

Common Cause encourages voters to Judge the Ads for court candidates with a skeptical eye. Watch for emotional framing. And question claims that may be inaccurate or taken out of context. Also note which groups pay for those ads, Common Cause advises: Question who is behind those groups and what they may stand to gain.

Just as importantly, listen carefully to the candidates. “Focus on judges who are talking about principles of fairness and upholding our democracy as an important aspect of how our state works,” Tavenor said.

“And really just pay attention to whether or not the judges are talking in partisan language versus nonpartisan language,” he added. “Our judges really shouldn’t be focused on the goals of political parties.”

Ohio high court races will decide future of state’s energy transition and utility fairness is an article from Energy News Network, a nonprofit news service covering the clean energy transition. If you would like to support us please make a donation.

Five years after Gov. Mike DeWine signed House Bill 6 into law, Ohio citizens and ratepayers are still paying the price. 

Ohio lawmakers still haven’t taken steps to repeal the rest of the nuclear and coal bailout bill, which is the focus of what prosecutors say was a roughly $60 million bribery scheme by utility FirstEnergy and its affiliates. Cases continue to wind through the courts, and two men implicated in the scandal have apparently taken their own lives. 

“It’s been really painful, and we’re still living with the consequences of House Bill 6,” said Catherine Turcer, executive director of Common Cause Ohio.

Shepherded by former Ohio House Speaker Larry Householder, the bill swept through the legislature in 2019, passing just 3 and a half months after its first introduction and despite massive opposition from consumer advocates, environmental groups, renewable energy interests and others.

The law called for more than $1 billion in subsidies for two nuclear plants for which FirstEnergy had been seeking bailouts since 2014. Additional provisions included subsidies for two 1950s-era coal plants known as the OVEC plants, along with gutting of the state’s renewable energy and energy efficiency standards. A referendum effort that would have let voters reject the law under Ohio’s constitution was ultimately thwarted amid claims of misleading ads, harassment of signature collectors and other problems.

One year after the bill passed, federal agents arrested Householder and others on charges under the Racketeer Influenced and Corrupt Organizations Act, known as RICO. The complaint outlined a $60 million criminal enterprise scheme funded by dark money, most of which came from FirstEnergy or its affiliates — roughly four times as much as the Energy News Network and Eye on Ohio had been able to track before the arrests.

Sam Randazzo resigned his position as chair of the Public Utilities Commission of Ohio months later, following an FBI raid on his home in November 2020. In July 2021, FirstEnergy entered into a deferred prosecution agreement with the Department of Justice, admitting it had bribed Householder and Randazzo.

Neil Clark, a lobbyist indicted in the scandal, apparently committed suicide in Florida in March 2021. Randazzo did the same in a Columbus warehouse he owned in April of this year, as he faced indictments on both federal and state criminal charges, along with loss of his license to practice law.

Calls for a full repeal of HB 6 came immediately after the 2020 arrests, but languished for months. Months after the next election, lawmakers finally repealed the law’s nuclear subsidies and a provision for guaranteed utility revenue, but left the rest of the law intact.

Bills to repeal the coal plant subsidies still have not gotten a full vote, and the state’s clean energy standards remain gutted. And full information about the corruption scandal has yet to come out, including answers to questions about Gov. Mike DeWine’s and Lt. Gov. Jon Husted’s involvement.

“The legislature hasn’t done anything to create greater transparency, to address dark money, to ensure we aren’t ripped off,” Turcer said.

“There’s this interesting intersection of dark money and gerrymandering and general decision-making and accountability at the statehouse,” Turcer continued.

Dark money refers to political spending that can’t be readily traced, and gerrymandering is the drawing of voting districts to advantage one political party over another. Together, both can undermine democracy and have delayed progress on climate change.

Still subsidizing coal

“The fact that we’re still bailing out the coal plants is just insane to me,” said Neil Waggoner, Midwest campaign manager for the Sierra Club’s Beyond Coal program. The Kyger Creek plant is in Cheshire, Ohio, and the Clifty Creek plant is in Madison, Indiana. Both plants consistently lose money.

“Those coal subsidies are costing consumers $500,000 per day,” said Ohio Consumers’ Counsel Maureen Willis. Her office estimates Ohioans have paid more than $330 million since January 2020. RunnerStone, a consultant for the Ohio Manufacturers’ Association Energy Group, projects the HB 6 coal subsidies could reach $1 billion by 2030.

The utilities that own the plants defend their continued operation.

“Customers in Ohio receive electricity from OVEC for what it costs to produce it and the funds are used to pay down debt with no proceeds going to shareholders,” said Scott Blake, a spokesperson for American Electric Power, which owns the largest share of OVEC, with other utilities inside and outside ofn Ohio owning shares. More than 500 employees work to make sure the plants operate as efficiently as possible, he added.

Since 1999, however, Ohio law has generally let consumers choose their electricity supplier. “And recent testimony by Duke executive [Amy] Spiller confirms the coal plants will continue to operate even if the subsidy ends,” Willis said.

The question comes down to whether the companies that made bad business decisions to keep noncompetitive plants running should pay their expenses, “as opposed to the public eating the cost,” Waggoner said.

Higher bills

HB 6 not only added subsidies to consumers’ electric bills. It also axed clean energy standards whose net savings for Ohioans had been about $9 per month.

“The elimination of the energy efficiency programs never made sense because they helped customers reduce their electricity usage,” said Rob Kelter, an attorney with the Environmental Law & Policy Center. “They lowered their bills. And they reduced pollution.”

Yet a legislative analysis claimed cutting those programs to pass HB 6 could save Ohioans’ money, a position that was further buttressed by testimony from then-PUCO chair Randazzo. Those arguments left out customers’ savings from avoiding wasted energy and lower overall capacity costs, Kelter said.

A bill to allow some permissive energy efficiency programs finally passed in the Ohio House last month, but passage in the state Senate isn’t guaranteed.

Regulatory scrutiny

Randazzo not only played a key role in shaping HB 6 and getting it passed. He also shaped the PUCO’s piecemeal response after Householder and others were arrested. That approach has continued, even after criminal charges were brought against Randazzo in federal and state court.

“Even after the revelations of what former PUCO Chair Sam Randazzo did for FirstEnergy in the halls of the PUCO, the agency itself has not had to answer to the public,” Willis said. “Case decisions issued while the former Chair led the agency have not been examined.”

“Why has there not been a management audit at the commission?” asked Ashley Brown, a former PUCO commissioner who subsequently headed the Harvard Electricity Policy Group. “Something clearly went wrong. We know that the chairman was bribed. We know that the other people went along.”

Agency spokesperson Brittany Waugaman noted the PUCO has four ongoing investigations in cases relating to FirstEnergy, but did not respond to questions about whether regulators plan to conduct an internal review of its own operations or otherwise review decisions in which Randazzo had participated.

Moreover, “the PUCO too often has made it difficult to get to answers for consumers,” Willis said. “Adverse discovery rulings, unrealistic case schedules, and limited audits, are a few of the problems for consumers.”

Who else?

The federal Department of Justice asked for three delays in discovery for the state regulatory cases, but after the initial 2020 arrests Randazzo was the only additional individual to face federal criminal charges, and he is now deceased. Meanwhile, Ohioans remained on the hook for charges. So in Brown’s view, the delays made sure consumers continued to be victimized by the crime.

The state did file criminal charges earlier this year against former FirstEnergy executives Chuck Jones and Mike Dowling, along with Randazzo and companies he controlled, as well as Householder. Company lawyers previously identified Jones and Dowling as having paid the bribes behind HB 6. But it remains unclear whether they or others will ever face federal criminal charges, said Dave Anderson, policy and communications manager for the Energy and Policy Institute.

Anderson and others also have questions about the involvement of American Electric Power, which paid $900,000 to dark money groups that supported HB 6.

Blake, the AEP spokesperson, said “management does not believe that AEP was involved in any wrongful conduct in connection with the passage of HB 6.” 

Anderson rejects that notion.

“While AEP has not been charged with any crime in connection with HB 6, disturbing new details about the financial relationship between Householder and the utility emerged during the convicted former Ohio House Speaker’s trial last year,” Anderson responded. And the company also has acknowledged it may face civil penalties from a SEC investigation, he added.

“I don’t how AEP defines wrongdoing, but common sense should tell AEP’s customers and regulators that something stinks here,” Anderson said. “AEP owes ratepayers answers, and unfortunately the PUCO has completely failed to investigate AEP’s role in the HB 6 scandal.”

Some bright spots

As consumers continue to face consequences from HB 6, so do Householder and lobbyist Matt Borges, Turcer said. Both are in federal prison while they appeal their criminal convictions in federal court from last year.

FirstEnergy might have to allow some credits or pay penalties as a result of the four pending PUCO cases, Anderson noted. That would be in addition to a $230 million penalty paid to the federal government and class action settlements in a few court cases.

Quarterly reporting requirements under the deferred prosecution agreement of donations to nonprofit groups also may have reined in some of FirstEnergy’s political influence in Ohio, Anderson said. FirstEnergy spokesperson Jennifer Young said the company plans to continue reporting donations, even after the deferred prosecution agreement’s term ends.

Young also highlighted other company reforms including enhanced controls, separation of functions for its top ethics and legal officers and better transparency to stakeholders.

“Today, FirstEnergy is a different, stronger company with a sound strategy, a highly effective compliance program and a companywide culture of ethics, integrity and accountability,” Young said.

Yet the company’s claims about transparency have fallen short, Willis said. “Lawyered-up FirstEnergy… continues to block efforts to publicly disclose their internal investigation reports produced in the wake of the HB 6 scandal.”

Energy policy

Ohio’s energy policy continues to feel impacts from HB 6 as well.

“It does make me wonder where we would be with renewable energy if HB 6 had been completely repealed, or if there hadn’t been this orchestrated campaign, not just to bail out nuclear plants or subsidize coal plants, but also to diminish our commitment to renewable energy and our funding for renewable energy,” Turcer said. Yet now, “the air we breathe is actually dirtier.”

HB 6 “cast such a long shadow over energy policy in Ohio,” said Tom Bullock, executive director for the Citizens Utility Board of Ohio. The energy industry is going through the greatest change in a century, with technological innovations in how energy is produced and stored, as well as new business models, he noted.

“We need to be thoughtful, so that we can grow industry and keep prices affordable and convert to clean and smart and distributed energy,” Bullock said. Otherwise, “We’ll be the last in the Midwest to get there if the way we make energy policy decisions is based on the wish list from traditional energy interests.”

Consequences continue as bill at center of Ohio utility corruption scandal marks fifth anniversary is an article from Energy News Network, a nonprofit news service covering the clean energy transition. If you would like to support us please make a donation.