Cost of Withdrawal from Paris Accords

Ohio’s electricity sources are diverse, as shown in the following table:

Sources of Ohio’s Electricity, 2016

Data from electric Power Monthly, Feb. 2017


Coal 47
Natural Gas 20
Nuclear 11
Renewables 2
Imports from Other States 19


The difference from 2008 is that coal has lost ground to both natural gas and imports.

The distribution in the table appears to be ideal for supporters of withdrawal from the Paris Accords on climate change. However, it would be expensive to sustain. Specifically, additions to all residents’ bills would be about $11 per month minimum due to coal, and perhaps much higher. Also, Ohio residents in the First Energy area would have an added $5 monthly charge to support nuclear plants.

Note: Coal costs are from the LSC Fiscal Analysis of 132-SB155. Nuclear costs are from testimony on 132-HB178. Data in the Table is from Electric Power Monthly.


Decrease in Ohio Shale jobs

Shale jobs have been decreasing for several years. According to the latest data, there were only about half as many core jobs, such as drilling and pipeline construction, as there were three years earlier (1). At under 10,000, job creation is a small fraction of the Chamber of Commerce prediction of 60,000 (2)

Only part of the difference between prediction and reality can be attributed to auxiliary jobs, such as truck driving. Since Jobs and Family Services (1) only has the total number of truck drivers, they assign those drivers to shale jobs, even the unknown number working for FedEX and other companies. Therefore the tens of thousands reported auxiliary jobs (1) are likely to be greatly exaggerated.


(1) Ohio Department of Jobs and Family Services, Ohio Shale Quarterly Reports,, accessed 21 April 2017.

(2) Ohio Chamber of Commerce Educational Foundation; Economic Potential for Shale Formations in Ohio, n. d.


Several years ago Pfund & Chhabra showed that electricity rates are similar in states with large and small amounts of renewable energy. (“Renewables are Driving up Electricity Prices, WAIT, WHAT” DBL Investors, March 2015). I confirmed this finding via an update (A.R. Rosenfield,  “Testimony on HB114, posted on LWV Ohio web site).

The same holds for unemployment for states with less than ten percent hydropower.(see graph with data from Energy Information Administration: Electricity Data Browser; Bureau of Labor Statistics: Table 1. Employment status of the civilian noninstitutional population)  I eliminated hydropower because significant hydropower is unlikely in Ohio and it is believed to lower rates and bias the evaluation of renewable energy.

In the graph each each dot represents one state. Fourteen states have levels of renewable energy equal to, or greater than, Ohio’s eventual goal of 12.5 percent. As can be seen  from the graph, the states with large amounts of renewable energy show similar unemployment levels as those, such as Ohio, with little renewable energy.



Once more the Ohio Legislature plans to deal with electricity supply.

Once more they will complain about the high cost of clean energy.

Once more they will be wrong.

For the last several years the Legislature has focused on discouraging clean energy to the exclusion of the bigger problem of soaring residential rate increases. We have seen an almost annual chopping away at the clean-energy requirements in existing law. At one point the legislature even declared blast furnace exhaust gas to be renewable energy. This concentration on renewable energy ignores the average Ohioan, who is more concerned about the size of his electric bill than the number of wind farms in the state.

We need to know why electric bills almost continually go up. Electricity doesn’t change; when we pay our bills, we are not buying new and improved electricity. Actually the electricity that comes to our outlets is the same product that our parents bought, and our grandparents, and our great grandparents. If the product doesn’t change, shouldn’t the price remain about the same?

When Ohio’s clean energy bill was passed nine years ago the average electricity rate was around ten cents per kilowatt-hour (kWh). It is now around 12.5 cents, a 25 percent increase. It was rising at twice the rate of inflation before a small decrease last year. Household electric costs are now $300 more than they were when that clean energy bill was passed. It so happens that state income taxes have been reduced by about $300 for the typical family. Their tax relief has gone to the electric company to pay their higher bills.

The obvious logic is that clean energy caused the rate increase. But clean energy costs are reported on our electric bills, where we can see that they are a very small part of the problem.

Renewable energy has become increasingly attractive because of sharp price decreases. According to the 2016 Wind Market Report, real prices for electricity from new wind farms are about 3.5 cents per kWh in our part of the country, while the PUCO Apples-to-Apples web site shows that the generation part of Ohioans electric bills averages over 5 cents per kWh for a combination of coal, gas, and nuclear power – a thirty percent savings from wind over old-fashioned technology.

This price advantage has been recognized by many large companies, such as Apple and Google, who have made major commitments to renewable energy. Amazon’s commitment to renewable energy is seen here in Ohio, where they will be purchasing a large part of the state’s wind output. If wind was as expensive as the opponents claim, Wall Street would be reacting strongly and driving down the price of the stocks of these companies This has not happened.

Clean energy opponents still maintain that wind energy is expensive. To do so, they rely on a theory called levelized cost of energy (LCOE). Opponents’ cost estimates for wind are much higher that the price currently being charged by wind farms. If these theorists are correct, wind farms are losing 50 to 80 cents on the dollar. No explanation has been offered for this discrepancy between theory and reality.

Opponents also claim that the clean energy requirements are mandates on electric companies that inhibit the free market. This claim is only true for the generation part of providing electricity. In fact, consumers have a choice of generating company, and prices for this part of electric bills have moderated. There is no choice for the transmission and distribution parts of our bills, and this is where the large price increases have been concentrated.

Finally, opponents claim that subsidies give renewables an unfair advantage over fossil fuels. The subsidy is a federal issue, which the legislature has no control over. It is worth noting that most experts agree that wind would be competitive without the subsidy and that solar is getting there. The subsidies operate to lower our prices.

Electricity is a necessity. The legislature needs to stop blaming clean energy for excessive price rises and insure that average Ohioans are being treated reasonably.


Renewable Energy Does Not Harm Stock Performance

There are still office holders who cling to the notion of expensive renewable energy, buttressed by questionable web sites.

There is a line of argument that I have not seen used: companies, such as Google and Amazon, have made major commitments to renewable energy. These are publically-traded firms. If renewable energy was so expensive, Wall Street would be shouting loudly and hammering their stock down. This has not happened.