free markets

Why did the free-market conservative abandon his principles to support a bailout of the coal industry?

A funny thing happened along the way to the proposed bail-out of the coal industry. Powerful Ohio Republican Rep. Bill Seitz, the number three man in the state Legislature, abandoned his long-held belief that the government has no business telling anyone what kind of energy to buy, and began picking energy winners and losers.

“We should be able to buy power from wherever it is cheapest,” Seitz said to the Columbus Dispatch in March 2014.

In an interview with the Dayton Daily News a year ago, Rep. Seitz declared, “When a socialist makes a product that consumers won’t buy, he gets the government to mandate that people must buy it. It’s that simple. Because I am a capitalist, I do not favor mandates.”

Bye-bye to Free Market Principles

Yet by November 2017, Seitz had changed his tune.

In a memo written on official Ohio House of Representatives letterhead, sent to us by a reader, Rep. Seitz wrote to colleagues urging their support for OVEC Bill HB 239. The Ohio Valley Electric Corporation (OVEC) is a coal plant cooperative owned by the state’s four investor owned utilities —Dayton Power & Light, FirstEnergy, American Electric Power and Duke Energy — along with utilities in several neighboring states. The proposed legislation would allow these utilities to charge their ratepayers more to provide subsidies to save the state’s uncompetitive coal and nuclear plants.

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“Ohio’s four investor owned utilities… currently do not recover either their cost or any rate of return. This is unfair,” wrote Seitz, “especially considering that OVEC was originally built to serve national security interests.”

Strange words from a self-proclaimed capitalist who believes in the right to buy power from wherever it is the cheapest and not picking winners and losers.

Seitz went on in the memo: “Department of Energy Secretary Rick Perry indicated that he wants that uranium enrichment operation to resume, so the national security issue is still on the table.” (Read the full memo HERE.)

Even Trump’s Commissioners Say No

But last week, the Federal Energy Regulatory Commission (FERC) voted unanimously to reject Perry’s proposal to compensate coal and nuclear plants. The idea supported by Seitz made so little sense, even with the goal of strengthening the “resilience” of the electricity grid, that even the commission members appointed by President Trump rejected it.

What motivated Rep. Seitz to push legislation that would permit Ohio utilities to charge their customers more to save inefficient coal plants?

Why would he want to enable the manipulation of electricity markets to help utilities and coal companies after years of proclaiming the virtue of free markets?

Over the last decade, Ohio’s use of coal as a power-generating fuel has dropped from around 80 percent to 60 percent. Natural gas has grown from three to twenty-three percent, according to Cleveland State University’s Andrew Thomas. And in Midwestern states other than Ohio, wind energy is surging.

Yet Rep. Seitz, the champion of free markets, wants consumers to pay more for coal. Why?


Scott Peterson is executive director of Checks and Balances Project, an investigative blog that seeks to hold government officials, lobbyists and corporate management accountable to the public. Funding for C&BP comes from sustainable economy philanthropies and donors.


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