With global energy demand expected to increase by 40 percent over the next 20 years, Ohio and the nation will need every source of clean and reliable energy we can get, including energy efficiency, to keep costs manageable.
Let’s face it, coal helped make Ohio an industrial powerhouse in the last century and continues to play an important role today. In fact, as recently as 2008, coal provided 85 percent of Ohio’s power. But while Ohio is a coal-mining state, few realize that Ohio imported nearly three-quarters of the coal its power plants used in 2008 — some from as far away as Montana and Wyoming — at a cost of $1.87 billion.
The energy landscape is shifting in favor of cleaner, more secure, affordable and reliable sources of energy, including shale gas. Five years ago, Ohio took a major step forward with the enactment of Senate Bill 221, which created an innovative energy plan for the state that emphasized the need for energy efficiency and renewable energy sources. Last year, Gov. John Kasich championed an energy plan, Senate Bill 315, that further refined the state’s strategy by expanding energy efficiency and renewable energy markets and adding additional industrial efficiency technologies.
The fundamental impact of these changes has been to reduce energy demand, diversify energy sources, lower the cost of electricity for ratepayers and make Ohio more competitive. Energy efficiency standards have reduced energy demand significantly and have helped Ohio utilities — and ratepayers — avoid the cost of building additional generation facilities. To date, the utility efficiency programs under Ohio law have generated almost $1 billion in net savings. For every $1 invested in the program, Ohio ratepayers see a savings of $3 on their utility bill.
Renewable energy is also expanding. Solar capacity has increased rapidly, with installed capacity in the state more than doubling over two years to 45 megwatts as of February 2012. Ohio currently has 449 megawatts of wind resources, enough to power over 100,000 homes annually, and another 1,300 megawatts of wind projects are under construction or are awaiting permitting. If all of that capacity were built today, it would make Ohio a top 10 wind energy state. Renewable energy projects have created thousands of construction jobs and are the source of significant property tax revenues in communities where they are located.
Even with all of this activity, advanced energy can have an even greater impact. Ohio has the capacity to grow existing and planned wind projects 20-fold given its available wind resource, and the state has 288 megawatts of untapped hydropower potential. Energy efficiency may be the biggest opportunity of all. According to the American Council for an Energy Efficient Economy, through continued investment in energy efficiency programs, Ohio ratepayers could see a total net savings of $3.3 billion annually on electricity bills by 2025.
Ohio’s advanced energy standards have helped spawn a new industry in Ohio. Our advanced energy industry today includes 400 companies employing 25,000 Ohioans. One of those companies is Akron-based Echogen, which is developing a breakthrough waste heat recovery system that will improve the competitiveness of manufacturers by turning waste exhaust into electricity — for which there is a huge opportunity in the state.
With Ohio’s research and technology, talent and advanced manufacturing base, this industry can grow significantly and become a driver in Ohio’s economy. We could also become a global supplier of advanced energy products and solutions to other countries who desperately need sources of clean and reliable energy.
The Ohio Senate is currently reviewing Ohio’s advanced and renewable energy to determine whether they should be rolled back or modified. While it is sensible to review state policies periodically to make sure they are working well for Ohioans, it is clear that these policies are working and are providing immediate and future benefits for Ohio. We urge the state’s leaders to stay the course. The best is yet to come.
Ford is president and chief executive officer of Advanced Energy Economy Ohio.