Computer Predictions Regarding Renewable Energy are Unrealistic

Testimony at the final hearing of the Electric Mandates Study Committee predicted dire economic consequences of resuming the timetable in 130-SB310. These warnings were based on two reports (I, ii) that used a computer model of a state’s economy. However there were two serious omissions in both studies:

  1. Neither report includes cost estimates for RECs. The renewable energy goals are being satisfied by the purchase of renewable energy certificates (REC), which are considerably cheaper than the electricity itself.
  2. The efficiency goals are not included in either analysis. Efficiency has led to a net saving for Ohio ratepayers.

There is a separate issue as to whether the reports give realistic results for the situation they are calculating. For example, ATI (ii) estimates a cost range of $67-100/MWh for 2016. The 2015 price is about $20 (iii).

References

(i) American Tradition Institute The Cost and Economic Impact of Ohio’s Alternative Energy Portfolio Standard, April 2011

(ii) Randy T Simmons, et al. (Utah State University) Renewable Portfolio Standards: Ohio, April 2015

(iii) League of Women Voters of Ohio, et al. Report on Residential Green Electricity compliance Costs, July 16, 2015 (Table 2, using a typical residential usage of 750 MWh/mo.)

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