The Story Behind “The Worst Energy Policy In The United States”

• Ohio’s House Bill 6 was widely regarded as the worst energy policy in the United States.
• The passage of House Bill 6 was so odorous of underlying offense and scandal that it helped to spark an FBI investigation into Rep Larry Householder’s activity.
• While Ohio repealed parts of the bill as it became embroiled in scandal in March of last year, HB6 still largely favors fossil fuels over renewables.

Ohio’s House Bill 6 was “widely recognized as the worst energy policy in the country,” according to a 2020 Vox article by Leah Stokes, an environmental political scientist at the University of California, Santa Barbara. The now-infamous bill gutted renewable energy budgets and bailed out coal and nuclear plants, to the shock, awe, and outrage of nearly everyone who wasn’t a fossil fuel exec or the man who made it all possible – Ohio Speaker of the House of Representatives Larry Householder.

The passage of House Bill 6 was apparently so odorous of underlying offense and scandal that it helped to spark an FBI investigation into Householder’s activity in the Ohio government and whether there were any behind-the-scenes puppet masters pulling strings in favor of the fossil fuel industry. The four-year investigation involved phone taps, informants, and tracing the movements of huge amounts of money to and from Householder and local utilities. As it turns out, Householder was indeed involved in a “grand conspiracy” which involved hefty bribes from three Ohio electric utilities: FirstEnergy, its former subsidiary Energy Harbor, and American Electric Power.

According to Federal Prosecutors, these companies gave Householder a $60 million slush fund to recruit other fossil-fuel-happy politicians into the Ohio legislature. As part of the deal, “Householder helped steer billions of dollars in subsidies their way” according to reporting from Grist. And then there was their magnum opus: HB6. The bill allowed utilities to use about half of the renewable energy than they had previously been required to put in their mixes, got rid of energy efficiency laws entirely, and handed billions of dollars to nuclear and coal plants to keep their operations running.

Householder and his partners argued that the bill was essentially a nuclear bill, which could then be spun to be a clean energy bill since nuclear energy emits no greenhouse gases. Critics saw this as greenwashing at best and outright dishonesty at worst. “House Bill 6 was really a coal bailout wrapped in a clean energy and nuclear argument,” said Vox writer Stokes, who also wrote about the scandal in her book Short Circuiting Energy Policy.

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What’s more, the bill wasn’t just bad for the environment. It was also bad for Ohioans, ultimately costing them an undue 2 billion extra dollars in excess utility bills, and another $7 billion in health care costs related to pollution ushered in by HB6 over nine years, according to calculations by energy consulting firm Gabel Associates. “There’s a clear pattern,” Stokes was quoted by Grist. “Utilities are rolling back climate policy, and they are charging ratepayers to do it.”

As for Householder, he’s still awaiting a trial that has been postponed due to Covid-19. While the evidence against him and the orchestration of HB6 is condemning to say the least, the legacy of the bill lives on. While Ohio repealed parts of the bill as it became embroiled in scandal in March of last year, HB6 still largely favors fossil fuels over renewables. According to a report from Energy News released eight months after a federal complaint was filed detailing the scandal, a “surgical repeal” of parts of the bill leaves in subsidies for two 1950s-era coal plants among other props for fossil fuels and nuclear. Meanwhile, many efforts to repeal more of HB6 have stalled.

While his hubris and greed was unusually unbounded and obvious, it seems unlikely that Larry Householder is an isolated case. Unfortunately, utilities that have already sunk money into fossil fuels are highly incentivized to find a way to keep renewables at bay. “For regulated utilities, profits are determined by how much political influence you wield,” Dave Anderson, communications and policy manager of the Energy and Policy Institute, was quoted by Grist. “It’s really just all about the money and driving as much profit as they can for their shareholders.”

On the other hand, the scandal is indicative of a wider issue: there is an ongoing struggle to find balance between renewable uptake and fossil fuel phaseout in the global green energy transition. Fossil fuels simply can’t be discarded overnight, and renewable energy is a long way away from being able to replace that kind of energy capacity. In the meantime, finding the path toward a smooth energy transition with as few energy crunches as possible requires a delicate balance between investing more heavily in renewables without leaving oil and gas in the lurch. The complications of this tightrope walk have left many industry insiders in a new and unprecedented state of uncertainty and fear, leaving the door open for the Householders of the world to take advantage of a sticky situation.

By Haley Zaremba for Oilprice.com

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