December 2022 – Ohio Policy Update

BPA tracks the latest policy updates and legislative issues in many states across the nation. See the latest policy information for Ohio as of December 2022.

Disclaimer: Inclusion of any bills/regulations in this state policy update does not equate to BPA’s endorsement.

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The Ohio Legislature is currently considering HB 389, which would authorize utilities to administer energy efficiency programs and set an annual energy savings goal of 0.5 percent. After the bill passed unanimously through Committee in 2021, HB 389 is scheduled for a vote on the House floor in early December. At the time of this writing, the chamber has not held a vote on this legislation (see more details below).

Meanwhile, the Public Utility Commission of Ohio is currently reviewing public comments on opportunities to distribute federal funding through the Infrastructure Investment Jobs Act of 2021 to improve grid resilience and demand response practices including through the use of smart grid technologies and distributed energy resources in homes and buildings. Passed by US Congress in 2021, IIJA provides substantial funding to Ohio and nationwide to finance energy efficiency and clean energy measures in homes and buildings (more details below).

Regulatory Monitor:

• The Public Utilities Commission of Ohio (PUCO) has scheduled a public hearing on February 8 to consider implementation of demand-response programs through PUCO. The hearing is scheduled with reference to provisions under IIJA, which added demand-response practices to the list of standards that state regulatory agencies may choose to implement. For the demand-response standard, PUCO has established initial and reply comment deadlines of January 10 and January 24, respectively, ahead of the hearing on February 8.
• ASE Ohio – a regulated electric utility that provides service to over 527,000 customers in West Central Ohio – filed its latest Electric Security Plan (ESP) with PUCO. The ESP was proposed by ASE Ohio to “enhance and upgrade the utility’s network and improve service reliability” including through new energy efficiency programs for residential and low-income customers such as cost savings strategies utilizing smart thermostat technology. If approved by PUCO, ASE Ohio will impose an initial $1 surcharge on the customers’ utility to fund the ESP. PUCO has scheduled a public hearing regarding AES Ohio’s ESP application to be held in-person on February 2. PUCO is also accepting written comments through its website.
• PUCO held a public hearing on August 24 regarding potential funding opportunities to improve electric grid resilience in Ohio. PUCO sought public comment ahead of its application for federal funding under the “Preventing Outages and Enhancing the Resilience of the Electric Grid” formula grant program, which was created by the IIJA of 2021 to provide grants to States across the U.S. for grid resilience measures including installation of weatherization equipment and advanced metering infrastructure. Comments on how Ohio may utilize funding from this federal grant program were due September 22. These comments may be used to inform the State’s application for its allocation of the Grid Resilience Formula Grants, due March 31, 2023.
• The Public Utilities Commission of Ohio (PUCO) closed public comments in May after a series of workshops to solicit stakeholder input on utility energy efficiency programs. PUCO will utilize input from the public comments and workshops to “help develop cost-effective energy efficiency programs to manage electric generation costs and determine how those programs fit into Ohio’s competitive electric and natural gas marketplaces.”
• PUCO has approved statewide utility AEP Ohio’s gridSMART project. As a result, the utility will install advanced metering infrastructure (AMI) for approximately 475,000 customers. AEP Ohio will also provide $500,000 to launch a new program offering rebates to customers for the purchase and installation of smart thermostats. The order from PUCO authorizes customers to own their data from AMI and choose to share that data with any third party. More details on when AEP will begin to deploy smart meters and launch the smart thermostat rebate program are still to come.

Legislative Monitor:

2022 Regular Session Dates: January 3 until December 31. **Note: Session remains ongoing throughout the year.

Bills currently under consideration:

• HB 389 Regards energy efficiency and peak demand reduction portfolios sets a requirement for utilities to achieve 0.5 percent annual energy savings and directs electric utilities to administer residential and commercial energy efficiency and peak demand reduction programs. The bill specifically requires state utilities to deploy residential smart technology including thermostats and heat pump water heaters to achieve peak demand energy reduction and requires each utility to design their resource portfolios with an emphasis on smart technology measures including thermostats, lighting, and appliances. The bill also requires that utilities administer at least one low-income residential energy savings program. HB 389 was introduced on August 12, 2021 with bipartisan sponsorship and received a unanimous vote to pass in the House Committee on Public Utilities on November 18, 2021. The Ohio House is scheduled to take up consideration of HB 389 on December 1 but has not posted a formal vote on the chamber floor at the time of this writing.
• HB 646 Regards residential property assessed clean energy (PACE) loans establishes a regulatory framework for residential property assessed clean energy (PACE) loans that a local government or local authority (implementing entity) must follow if such entity adopts a PACE loan program. The bill also provides consumer protections on PACE loans by restricting who can qualify for a PACE loan, terms of financing, contract terms, required disclosures, and notices to the homeowner. The bill was introduced on May 11 and referred to the House Committee on Civil Justice on May 17.
• HB 429 Regards clean energy and energy justice establishes statewide goals to meet a 50% reduction in greenhouse gas emissions from electricity by 2030 and a 100% reduction by 2050, compared to a 2005 baseline. The bill would also set energy efficiency targets for each Ohio utility to reduce energy use 22% by the end of 2030. To this end, the bill creates the Governor’s Office of Energy Justice, which would—among other responsibilities—oversee new workforce development and contractor equity programs aimed at training marginalized and low-income individuals in clean energy or energy efficiency industries. HB 429 was introduced on September 21, 2021 and referred to the House Committee on Public Utilities on October 12, 2021.
• SB 222 Provide sales tax holiday in March for Energy Star products proposes a three-day sales tax “holiday” each March during which sales of qualifying Energy Star products are exempt from sales and use taxes. The bill was introduced on September 22, 2021 and referred to the Senate Committee on Ways and Means.
• HB 192 Prohibit political subdivisions from prohibiting certain types of energy generation prohibits counties, townships, and municipal corporations from prohibiting energy generation from fossil fuels and gas pipelines. The bill was introduced on March 19, 2021 and referred to the House Committee on Energy and Natural Resources.
• HB 57 / SB 44 Repeal HB 6 of the 133rd General Assembly seeks to continue funding and state programs pertaining to energy efficiency provided through electric utilities designed to retrofit and upgrade homes for energy savings and peak demand reduction. Introduced on February 2, 2021, the bill passed unanimously in the Senate on March 3, 2021 and was referred to the House Committee on Public Utilities, where both versions of the bill have not had an initial hearing or committee vote.