Fracking Archives | Innovation Ohio

Jun 03 2019

HB6 latest: Ohio Nuclear Bailout Measure Reaches Senate

A bill that would raise utility rates to bail out two Ohio nuclear power plants while gutting renewable energy standards cleared the Ohio House this week. House Bill 6, the so-called “Clean Air” bill, was approved by a 53-43 vote in House following a week of extensive hearings and last-minute lobbying efforts. The bill now heads to the Senate. Ohioans will pay for a “Clean Air Fund” to bail out FirstEnergy Solution’s Davis-Besse and Perry nuclear power plants through a $1 monthly surcharge on their electric bills. Backers of the bill argue that this fee will save consumers money as the bill repeals the current $4.68 monthly utility fee. While the bill takes aim at lowering electric rates and protecting jobs in the nuclear energy industry, it guts Ohio’s clean and renewable energy standards.

Ohio would be the first state to enact a measure that subsidizes nuclear energy for financial reasons while at the same time eliminating clean energy standards. Make no mistake – Ohio lawmakers are making a deliberate choice to go this route. As noted by Inside Climate News, Connecticut, Illinois, New Jersey, and New York have subsidized nuclear power plants recently, however, those measures bolstered support for clean and renewable energy. With both parties split on this legislation in the House, it’s not so obvious what political motives are behind some lawmaker’s support for it. This has been sought out by FirstEnergy and its PAC for a while now. Campaign finance records indicate that thousands of dollars were donated by FirstEnergy and its executives to Speaker Larry Householder and his loyalists. The struggling utility company’s former CEO, Anthony Alexander, donated $5,000 each to Householder’s and Rep. Jamie Callender’s (HB6 primary sponsor) 2018 campaign, along with a maximum contribution of $12,707 to Mike DeWine’s campaign. The Governor has come out in support of this bill. The Cleveland Plain Dealer’s Editorial Board voiced its opposition to the bailout Friday, calling HB6 “a platter of goodies for deep-pocketed special interests who spent liberally — not just in advocating for this legislation but also on Householder’s efforts to get his supporters elected or re-elected to the Ohio House, so they could choose him as speaker.” One of the last-minute changes to House Bill 6 was to expand the bill to expand eligibility for the subsidies generated by the bill beyond the state’s two nuclear power plans to large solar facilities. According to the Ohio Power Siting Board, six facilities have been approved that would be eligible under the latest changes to HB6. A look at whose districts those facilities are located in suggests which lawmakers were targeted by the move:

Report finds shale development still not creating many jobs

Employment figures for shale counties – Click to enlarge

The promised employment boom from shale development in eastern Ohio continues to be underwhelming. A new report released this week by the Maxine Goodman Levin College of Urban Affairs at Cleveland State University found that counties where shale development is occurring saw sluggish employment growth through 2012. The report divided all counties in Ohio into four groups – strong, moderate, weak, and non-shale counties. Each county was placed into one group based on geological data and well activity. According to the report’s findings, strong shale counties grew at .6 percent in 2012, moderate shale counties at .5 percent, weak shale counties at .6 percent, and non-shale counties at -.4 percent. The report also examined employment trends for 2013. In the first quarter of this year, employment in strong counties grew by .1 percent and moderate counties saw an increase of .2 percent. All other counties saw some sort of decrease in employment – weak shale counties contracted by -.6 percent and non-shale counties fell by -.4 percent [Read more…]

May 17 2013

New shale report questions fracking’s short term benefit

On Thursday, State officials released the much anticipated 2012 Utica shale production report. Administration officials were quick to celebrate the findings of the report and heralded it as the beginning of a “new boom” in Ohio. Realistically though, this report includes information that should cause officials to temper their expectations – at least in the short term. As we have written in the past, the Kasich administration and the oil and gas lobby both promised that shale exploration would bring a wave of new jobs to Ohio. While recent reports have noted that not only were these claims dubious to start with, in reality the job growth is not nearly as strong as they originally estimated. The report provides some clues on why that is. Only 87 horizontal wells were producing oil and gas last year at some point – most of them were only active for three months or less. And while officials expect that number to increase to 362 by the end of this year it is still unlikely that the increase will lead to the giant job expansion promised. [Read more…]

Apr 30 2013

PolitiFact finds Oil and Gas Industry Jobs Claims to be Dubious

On Monday, the Cleveland Plain Dealer released a PolitiFact that examined recent ads by the oil and gas industry claiming to have created 40,000 jobs last year in Ohio. PolitiFact gave the ad its lowest rating — “Pants on Fire” — and strongly questioned the industry’s job creation claims. PolitiFact found that the ads overstate the number and type of jobs created and failed to disclose that many of these jobs may have gone to out-of-state workers. In addition, they found the fact that the numbers were based on economic modeling rather than actual surveys of employers undermined the veracity of the claim. PolitiFact also noted the high rate of turnover in industry hiring data, showing that even if Ohioans are being hired, the work is often temporary in nature. [Read more…]

Apr 10 2013

House Budget Changes Represent a Huge Win for Big Oil

If there was any question before Tuesday that the House Republican caucus was in the pocket of the oil and gas industry, the newest version of the state budget should put that issue to rest. The substitute version of the state budget (Sub. H.B. 59) that House leadership put forward yesterday removes almost every substantial policy change in the budget that affected the oil and gas industry. As introduced, Governor Kasich’s budget included multiple changes that addressed outstanding fiscal and regulatory concerns, including: [Read more…]

Apr 04 2013

Study: employment in Ohio shale counties has not increased significantly

In recent years, politicians, oil and gas lobbyists, and industry experts all promised that expanded oil and gas drilling in Ohio would lead to job creation and economic growth. However, a new report from Cleveland State University shows that even though economic activity increased in shale counties in 2012, employment growth failed to materialize. A March report from the Maxine Goodman Levin College of Urban Affairs examined two economic indicators to see if there existed any early economic trends in the development of the shale region in Ohio. [Read more…]

Feb 28 2013

Policy to help communities deal with impacts of drilling falls short

Communities in Ohio have borne the brunt of the deep cuts in Governor Kasich’s state budgets. In fact, just this week it was reported that local governments will receive $1.4 billion less in the next two years compared to fiscal years 2010 and 2011. On top of those cuts, many communities are dealing with costs associated with oil and gas exploration in their communities. Every horizontal well that is drilled requires millions of gallons of water and millions of pounds of equipment and supplies that must be trucked to the well location. County roads in eastern Ohio that were quiet not that long ago are now — or will soon be — well-traveled by large tankers and trucks. This will have a serious effect on road maintenance and road safety in these communities. In a nod to these issues, the Kasich administration’s two-year budget plan (HB 59) includes a new horizontal well loan program. Under the plan, well owners would pay counties an upfront $25,000 fee for use by local government entities to defray costs associated with drilling activity. The catch is this: local governments that receive these funds must repay the entire amount back to the well owner starting a year after the payment. While the administration portrays the new fee as helping local governments cover unforeseen costs, in reality they will continue to be on the hook for the entry amount of these costs. Communities all over Ohio have been hit hard by this administration’s cuts, but this proposal will do nothing to help them. Meanwhile, $200 million in new taxes on oil and gas drillers is going toward a tax cut for the wealthy rather than roads and infrastructure. Instead of a shell game, lawmakers need to find a policy that delivers real relief to these communities in the coming years.

Feb 25 2013

Oil and Gas policy shifts in Kasich budget benefit industry

Our sister organization, Innovation Ohio Education Fund, examined the policy changes in the Governor’s two-year budget (House Bill 59) as it relates to hydraulic fracturing for oil and gas. (Read the full analysis) Two policy changes suggest that the oil and gas industry got a sweetheart deal in this budget, at the expense of local communities and taxpayers. County Well Loan Program Ohio communities that are the site of horizontal drilling operations are incurring new, unforeseen costs associated with drilling, forcing them to spend already-limited funds for infrastructure repair and public services to deal with things like heavy truck traffic and an influx of transient workers. Included in the budget is language that on first blush appears to be good news for local governments. H.B. 59 requires horizontal well developers to pay a $25,000-per-well fee to the benefit of the County in which the well is located. Counties are directed to disperse these funds to local taxing entities to recoup costs incurred due to activities associated with these wells. But the bill requires taxing entities to pay back the amount of the impact fee, over a period of time, through a reduction in property taxes collected from the developers. While providing some up-front cash, the net effect of the policy change leaves local governments on the hook for 100 percent of the cost of the impact to their communities. [Read more…]

Feb 07 2013

Kasich Administration’s Severance Tax Proposal is Inadequate and a Gift to Big Oil

On Monday, Gov. John Kasich introduced his second operating budget which included sweeping reforms to Ohio’s tax structure. Included in those changes were modifications to how the state wants to tax oil and gas developers who are planning to extract vast quantities of resources in eastern Ohio via hydraulic fracturing. Unfortunately, these changes are inadequate and cause the state to rely upon other more regressive taxes that harm poor and middle income families. The governor’s severance tax proposal this week was similar to legislation that he called for but failed to get through the Ohio General Assembly in 2012. This proposal increases severance tax rates that producers pay depending on the type of hydrocarbon they extract. Producers will pay 1 percent on the value of gas they extract, 4 percent on both natural gas and natural gas liquids with the caveat that producers only need to pay 1.5 percent during the first year to recover well production costs. According to the administration, these changes will collect an additional $200 million in tax revenue over the next two-year budget cycle and a total of $920.9 million by the end of fiscal year 2017. [Read more…]