Ohio: We’re Number 1! (In Corruption, not in Green Energy) — Householder Trial Update # 8
By Sandy Theis, former reporter and political analyst
Ohioans are familiar with House Bill 6 as a symbol of our state’s crushing corruption and the degree to which powerful corporations steer political debate and dictate what policies become law. But revelations at the Householder trial this week also highlight the fact that House Bill 6 was part of a years-long push by utilities to crush Ohio’s green energy laws and move the state backwards.
Once a national leader in new, green jobs, the FBI has been in federal court making the case that Ohio is instead now a national leader in public corruption. According to the FBI, the scandal involves huge bribes paid by Akron’s FirstEnergy in exchange for passage of a law that saddled ratepayers with the cost of bailing out two money-losing nuclear power plants owned at the time by a FirstEnergy subsidiary and guaranteed revenue for the plants even when electricity use declined.
In perfect Orwellian fashion, the bill was initially marketed as the “Ohio Clean Air Program.’’ A true clean air catastrophe, one part of the bailout forced Ohioans to subsidize dirty, old coal plants—including one in Indiana. Another part gutted energy efficiency standards ushered in by former Gov. Ted Strickland, a Democrat.
The push to pass House Bill 6 was financed with more than $61 million paid mostly by FirstEnergy, allies and coal interests. Federal prosecutors insist the millions were used to install Larry Householder as Speaker of the House, then pass the bailout.
How Householder Personally Benefited
Householder and former Ohio Republican Party Chairman Matt Borges are on trial for racketeering for their alleged roles in the scheme. Federal prosecutors also have accused Householder of taking more than $500,000 in personal benefits from the company in exchange for passing the bailout bill. Attorneys for Householder insist that the money came not as a bribe but as a loan from Householder’s former top political adviser, Jeff Longstreth who pleaded guilty and took the stand this week for the prosecution.
In court this week Longstreth said the money was initially intended as a loan but Householder refused to sign the loan agreement they had drawn up and never even thanked him for all the cash. Householder used the money to pay debts, settle a lawsuit and pay for repairs to his vacation home in Florida. The loan was never repaid.
How Ohio’s Green Energy Standards Were Gutted
The trial has given Ohio rare insights into how business is transacted at the Ohio Statehouse, and how political donations have shaped legislation and undermined Ohio’s green economy.
On Feb. 22, defense attorney Steve Bradley asked House GOP staffer Pat Tully about HB 6, and Tully said that former Public Utilities Commission Chair Sam Randazzo helped to draft it. He also said that Householder pushed for total elimination of the renewable portfolio standards.
Even before the trial, we knew that Randazzo helped to shape the bailout bill but still do not know who actually wrote it because Ohio had closed records at the state’s bill-writing agency in response to a previous utility scandal.
Re-opening those records is part of a package of reforms proposed by Common Cause Ohio. No legislator has introduced a bill to let voters know who really writes legislation.
A Voice from the Grave
Earlier in the week, jurors heard secretly recorded conversations between undercover FBI agents and co-defendant Neil Clark who later died by suicide. “The Republicans really don’t want any energy efficiency at all,” Clark said during a surreptitiously recorded meeting played at the trial. History shows that Clark was right.
Ohio’s energy efficiency standard was passed in 2008 with just one dissenting vote. The standard required FirstEnergy and other electric utilities to help customers use less electricity annually through 2024 by switching home, office and industrial equipment to the most efficient available. Environmentalists have accused utilities of wanting to cut such standards to keep usage — and revenue — high.
A Race to the Bottom of Energy Efficiency Standards
Republican governors who succeeded Strickland quickly began to undermine the requirement which eventually resulted in lawmakers championing flawed utility-run energy efficiency programs.
In 2014, GOP Gov. John Kasich, who succeeded Strickland, signed into law Senate Bill 310, which put a two-year freeze on the standards for renewable energy and energy efficiency. The bill drew much of its support from electric utilities.
As the bill advanced, David Scott, board president of the National Sierra Club, called it a “reckless step backward that gives Ohioans fewer energy choices, fewer jobs, and dirtier air.”
During the often contentious debate over the freeze, opponents repeatedly said that 25,000 jobs were at stake, citing a 2012 study commissioned by a trade group for green-energy companies. Those opponents didn’t know that a taxpayer-financed study showed the number to be much higher.
The Development Services Agency commissioned the $435,000 study. “Accurate job data is critical in the evaluation of current programs and policies and the identification of industry sectors facing retraction and expansion,” the agency said in an internal memo from February 2013.
Instead of using the study to tout the success of the new standards, Ohio put it on a shelf until the Columbus Dispatch began inquiring about it in 2014.
Randazzo Repeals Renewables
According to the Associated Press, when Republican Mike DeWine became governor in 2019, the attacks on green energy quietly accelerated. This was with the help of a powerful expert in utility regulation—Sam Randazzo—the man recruited by the DeWine administration to lead the state panel responsible for setting utility rates, the Public Utilities Commission (PUCO). Randazzo was a well-known opponent of green energy and long-time ally of utilities and Lt. Gov. Jon Husted.
As part of the Ohio Power Siting Board, which Randazzo also chaired, the Board quickly got to work. In 2019, it issued decisions that blocked a new solar development and imposed cumbersome new restrictions on wind energy — moves consistent with Randazzo’s longtime criticism of renewables.
About two years into his term as PUCO chair, and just days after the FBI raided his condo, Randazzo resigned. And in July 2021, FirstEnergy told prosecutors that it paid a business owned by Randazzo $4.3 million before his 2019 appointment in exchange for “official actions.” Randazzo has not been charged with a crime.