The coal-fired power plants owned by Ohio Valley Electric Corp. (OVEC) were losing between $150,000 to $175,000 a day in April 2020, according to emails between officials of Duke Energy, one of the utilities that owns part of OVEC.
John Swez, Duke’s director of generation dispatch, said Duke should propose to the OVEC board that the company start running its power plants on an “economic” instead of a “must-run” basis.
The Ohio Manufacturers’ Association Energy Group (OMAEG) filed the emails on Jan. 22 as part of its campaign to limit the effects of HB 6, the 2019 law that requires Ohio ratepayers to subsidize the two OVEC power plants – Kyger Creek in Ohio and Clifty Creek in Indiana.
Swez’s April 8, 2020, email said Duke officials should ask the entire OVEC board to approve shifting how the company sends its electricity to the grid.
“My proposal is to offer approximately half of the units with a commit status of Economic starting with this Friday, April 10,” Swez wrote.
Audit called economic status “prudent”
The audit conducted by London Economics International (LEI) in 2021 for the Public Utilities Commission of Ohio determined that shifting the status of the OVEC plants in 2020 was “prudent. That option was in place temporarily in 2020; LEI recommends that AEP Ohio and the other members of the Operating Committee allow this flexibility on an ongoing basis.”
Auditors acknowledged the difficulty of running coal plants as economic all the time, because it takes extra time to get the plants warmed up and running. However, “the option to do so provides additional flexibility and could reduce costs for customers,” the audit said.
HB 6 requires Ohio electricity customers to pay a surcharge on their electricity bills to subsidize the OVEC plants. The law was passed in 2019 after utility FirstEnergy, which is also one of the owners of OVEC, led a $61 million campaign to bribe former Ohio House speaker Larry Householder, who is now serving a 20-year federal prison sentence.
Emails match Swez’s testimony
Last October, Swez submitted testimony to PUCO in the HB 6 audit case in which he said it was possible for OVEC to commit its electricity economically instead of must-run.
Swez also said Duke lacked the ability to force OVEC to change how it commits electricity to the grid. That requires a vote by officials from the companies that own OVEC, which are called the sponsoring companies.
Ray Locker is the executive director for Checks & Balances Project, an investigative watchdog blog holding government officials, lobbyists, and corporate management accountable to the public. Funding for C&BP is provided by Renew American Prosperity and individual donors.
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