A Supreme Rebuke of Ohio’s Renewable Energy Mandate

 

Big news last week as the United States Supreme Court issued a stay of the Clean Power Plan implementation until arguments against the CPP could be heard in federal court. What does this do for the states? Twenty-nine states filed suit against the CPP on the basis that the federal government was over-reaching beyond its legal authority, the plan would drive up electricity rates, hamper service reliability, and provide little environmental benefits. Some of those state attorneys general, including west Virginia and Kentucky, advised their states to immediately stop developing compliance plans.

In Ohio, we are waiting to see what Attorney General Mike DeWine does. At this point, DeWine was quoted in the media saying “This unlawful power plan is a power grab to force states into policies Congress has rejected and that would fundamentally alter the economies of states like Ohio,” Mr. DeWine said. “This stay is a significant victory, and the ‘Power Plan’ is yet another example of the Obama Administration overstepping its authority.” The big question is whether the Court’s ruling will have any impact on what the legislature does with Ohio’s Renewable Mandates. A judicial decision on the CPP will not be issued until sometime in 2017 but the legislature must act in 2016.

One trusted colleague looks at it this way: “The US Supreme Court’s grant of the stay may have the most immediate and largest impact on the business plans of electric utilities (like AEP, Duke and many others) that have been telling Wall Street that the CPP would help drive customer-funded investments in compliance hardware and contribute to a growth in shareholder earnings. Some utilities hoping to leverage the CPP to enhance earnings have focused on large investments in “renewable” forms of electric generation (mainly-utility scale wind and solar) with customers picking up the tab and environmental groups helping the utilities obtain needed regulatory approvals while claiming that all of this forced investment would someday and somehow be beneficial to customers. [The potential for the CPP to be leveraged by electric utilities to force electric bills and earnings higher was enhanced by Congress’ extension of bonus depreciation because bonus depreciation accelerates, in regulated states, the decline in “rate base” (the value of assets on which traditional regulation will allow utilities an opportunity to obtain a return on and of invested capital)]. While states like Ohio were challenging the CPP in court, many electric utilities were pushing forward with business models or plans to use the CPP as another means of pushing electric bills and earnings higher. “…

The U.S. Supreme Court on Tuesday voted 5-4 to suspend implementation of the federal Clean Power Plan in the face of an ongoing court battle. Ohio is among more than two dozen states pushing for the CPP to be thrown out over their protests that the federal government overstepped its authority in releasing the rule. The plan is aimed at reducing carbon emissions by 2030 by 32% of 2005 levels. But opponents contend the plan will drive up electricity rates, hamper service reliability, and provide little environmental benefits….

Attorney General Mike DeWine, who in October filed to join the unfolding lawsuit, said in a statement Wednesday he was pleased by the development.

“This unlawful power plan is a power grab to force states into policies Congress has rejected and that would fundamentally alter the economies of states like Ohio,” Mr. DeWine said. “This stay is a significant victory, and the ‘Power Plan’ is yet another example of the Obama Administration overstepping its authority.”

Ohio Environmental Protection Agency Director Craig Butler similarly praised the ruling.

“By staying U.S. EPA’s Clean Power Plan, the Supreme Court got it right,” he said. “The State of Ohio has pointed out the serious legal shortcomings of the federal Clean Power Plan on numerous occasions. We will evaluate the decision and determine how it will impact our plans moving forward.”…

Coal Association President Christian Palich called the ruling called it a victory for “Ohio coal families and energy consumers.”

“Congress and now our highest court have ruled against the illegal actions of radical EPA bureaucrats, bringing us one step closer to defeating this agenda and ensuring our energy grid has access to reliable and affordable power,” Mr. Palich said.

The Ohio Chamber of Commerce, which filed an amicus brief supporting the stay, also applauded the ruling.

“In Ohio’s continued pursuit of building a healthy and diverse economy, few things are more important than preserving access to affordable, reliable and predictable sources of energy,” Chamber Director of Energy & Environmental Policy Charles Willoughby said in a statement. “Manufacturers and other businesses must have access to energy solutions that best meet their needs, free from government interference and overly burdensome regulatory controls that stifle healthy economic growth.”…

 

from: Statehouse News

Ohio Officials Applaud Supreme Court Ruling That Puts U.S. EPA’s Clean Power Plan On Hold

Additionally: The Supreme Court issues an historic stay on Obama’s Clean Power Plan, the Wall Street Journal writes in an editorial….

Source: A Supreme Carbon Rebuke

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