Solar companies in Ohio have been delivered another blow.
It's official: Ohio power companies no longer have to get half of their renewable energy from in-state providers.
A law signed in July made clear the state's requirement that a 2008 law mandating alternative energy make up 25 percent of a utility's power source by 2025 be frozen at current rates for two years. Half of that 25 percent must come from renewable sources like wind and solar.
But regulators were unclear if the 6.25 percent in-state renewable energy requirement would be wiped out by the bill.
The Public Utilities Commission of Ohio has settled the matter: that provision will been eliminated completely. It's another blow to an Ohio alternative energy industry that has been battered this year.
"Pure financial projects are on hold right now," said Geoff Greenfield, president of Third Sun Solar in Athens.
The vague language of Senate Bill 310 meant the PUCO had to determine if the in-state requirement should be eliminated or pro-rated. Some commenters argued that legislators did not mean to eliminate the in-state requirement at all, but the PUCO rejected those arguments. Legislators like Sen. Bill Seitz, R-Cincinnati, had argued that the requirement is unconstitutional.
By getting rid of the in-state requirement, renewable energy companies, especially in solar, must now compete to sell renewable energy credits with other states. It's an issue of supply and demand: A solar company in a nearby state like Indiana, which doesn't have mandatory renewable energy standards, can now more easily sell to Ohio power providers that need to buy solar credits to comply with the standards.
So now companies from Indiana and whereever else can flood the Ohio market with their offers and lower the prices. The in-state requirement was seen as a boon to Ohio renewable producers; it provided a safety net, preventing power companies from seeking solar credits from other states, even if the credits went for less.
Solar companies have pretty much stopped doing large business and nonprofit projects in Ohio since Senate Bill 310 was first bandied about anyway, Greenfield said. His company only does residential projects in Ohio now, and goes to other states for commercial projects.
The in-state requirement impacts solar more than wind. But wind industry sources say another law passed this year to move back turbines from property lines will have an even bigger impact on its operations in Ohio.