Ohio's Nuclear Bailout Is Inspiring An Unprecedented Campaign. But Why Now?
Ballot efforts typically ramp up in the weeks before an election. The fight over Ohio’s new nuclear bailout law, though, is in full swing more than a year before a possible vote.
So why the early start? One side says it’s to keep two nuclear power plants from closing, while experts say spending now may be the best investment.
Chances are, you’ve seen the ads with a stomping Chinese army and a narrator warning that China wants to take over Ohio’s electric grid.
Observers and fact-checkers call the ads misleading. Yes, the Chinese government invests in Ohio’s energy market, but so do many other foreign entities. And all voter information is public, so the Chinese government already has access to it, if it wanted it.
In a referendum fight, these types of ads usually show up the weeks before an election, when the question is already on the ballot.
Not this time.
The law, House Bill 6, adds an 85 cent monthly fee to the electric bill of most Ohio customers. That fee will provide $150 million a year to FirstEnergy Solutions to prop up two unprofitable nuclear power plants in northern Ohio. It also lets utilities add subsidies to boost two failing coal power plants.
Supporters of the nuclear and coal plant subsidies don’t even want the referendum on the ballot. They’ve gone as far as to hire third-party petition blockers to shadow signature gatherersand try to convince people not to sign.
Ohio State University political science professor Herb Asher says the magnitude of this campaign is unparalleled.
“We’ve never seen this kind of concerted effort to really use scare tactics to try to deter people from signing petitions,” Asher says.
According to the Columbus tracking firm Medium Buying, after spending $9.5 million on broadcast ads to win legislative passage of the bailout, supporters have paid for an additional $3.5 million in radio and TV ads to stop the petitions. That doesn't count the thousands of dollars spent on mailers and petition blockers.
Medium Buying president Nick Everhart says in two decades of political consulting around the country, he can’t remember such bold and bizarre tactics.
“They’re waging a campaign against a ballot issue that does not exist, that’s happening on an election cycle that’s down the road,” Everhart says. “So it’s almost like they are attacking and going after a ghost.”
Political observers have varying theories as to why.
If the issue gets on the ballot, FirstEnergy Solutions and its supporters could spend millions on a campaign and lose. And most observers suspect general election voters will not look kindly on corporate bailouts.
So spending a few million dollars trying to end the campaign before it begins might be the best strategy.
Another reason for the pre-emptive campaign comes from supporters of the subsidies. They suggest if a referendum even gets on the ballot, regardless of whether it passes, the nuclear plants might shut down because of investors' uncertainty. That would give the natural gas interests behind the repeal effort a competitive advantage in the energy market, even if House Bill 6 is eventually held up by voters.
Carol LoParo, a spokeman for pro-bailout group Ohioans for Energy Security (which is running the anti-Chinese ads) says “the campaign is now.”
“If they qualify for the ballot, this issue won’t be voted on this year, it will be voted on in November of 2020, and if you paid attention to the House Bill 6 debate, these plants, they needed the funding immediately or they would close down.," LoParo says. "So their goal is not to have a vote on this, their goal is not to have an extensive campaign, their goal is to qualify for the ballot, shut down these plants so they can gain market share.”
Gene Piece speaks for Ohioans Against Corporate Bailouts, the group behind the repeal effort. He says LoParo’s argument is a strawman.
“I find that hard to believe that we would invest this time and this money in getting this on the ballot just to stop,” Pierce says.
Pierce says only FirstEnergy Solutions knows if the two nuclear plants really would shut down if the question qualifies for the ballot. FirstEnergy Solutions has declined to release its financial records.
“It sounds like they want to have their cake and eat it too,” Pierce says.
While the law is set to go into effect in October, the subsidies would not start flowing until 2021. Regardless of the ballot question, FirstEnergy Solutions would not start collecting money from ratepayers until after the repeal is decided anyway.
FirstEnergy Solutions declined comment on whether the plants would close if the repeal effort qualifies for the ballot.
Everhart has another theory. He suspects political consultants are driving the campaign to line their pockets.
“This just feels like a consultant’s cash grab and political malpractice,” Everhart says.
Whatever the reasons behind the anti-petition campaign, it only has a few weeks left. The group looking to repeal the bailout has until October 21 to collect nearly 266,000 signatures of registered voters.
If the repeal qualifies for the November 2020 ballot, that campaign could be just active and likely more expensive.