When Governor Mike DeWine signed Ohio House Bill 6 into law in 2019, FirstEnergy Corporation scored a major victory. Not only had the law created a $1 billion utility ratepayer bailout for the nuclear plants of its soon-to-be-former subsidiary, but the legislature did so by eliminating the funding for energy efficiency and renewable energy to pay for the bailout. Moreover, FirstEnergy Solutions Corporation, but also FirstEnergy’s Ohio utilities had locked in a favorable “decoupling” charge that ensured it could keep rates high for years to come. FirstEnergy’s CEO explained on an investor call in 2019 that this made the company essentially “recession-proof.” ELPC along with fellow environmental advocates and consumer groups opposed the law, noting that it was a huge step backwards for clean energy in Ohio.
The state is embroiled in what U.S. Attorney for the Southern District of Ohio David DeVillers called “likely the largest bribery and money-laundering scheme ever in the state of Ohio.” The scandal has touched the highest levels of the Ohio House of Representatives, exposed the shady origins of House Bill 6, and helped oust the Chair of the Public Utilities Commission of Ohio (PUCO).
Below is a timeline of this developing corruption scandal and ELPC’s efforts to fight for clean government and clean energy.
FirstEnergy Corporation makes a strong push to have Ohio ratepayers support its aging and costly nuclear power plants. FirstEnergy also begins looking for legislative support for further bailout funds, but finds little success.
October 12, 2016
The PUCO approved a ratepayer charge that would give up to $1 billion to FirstEnergy with no strings attached. In a news release, FirstEnergy calls the billion-dollar handout “disappointing.”
November 8, 2016
Larry Householder wins a seat in the Ohio House of Representatives. Householder had previously served in the Ohio House from 1997 to 2004 and as Ohio House Speaker from 2001 to 2004, but resigned due to corruption allegations. According to the U.S. Attorney’s criminal complaint, Householder and his team immediately started developing a plan to win Householder the speakership in January 2019.
February 6, 2017
Householder associates incorporate Generation Now, a 501(c)(4) organization not required to disclose its donors, in Delaware. Householder and his associates begin using Generation Now to receive secret payments and to help gain influence in the Ohio House of Representatives.
March 16, 2017 – March 3, 2020
“Company A Service Company”—widely understood to be FirstEnergy Service Company, a FirstEnergy affiliate—and related entities contribute almost $60 million to Generation Now.
January 2018 – November 2018
Householder and his associates – a group the U.S. Attorney’s Criminal Complaint termed “Team Householder” – select and support candidates in the primary and general elections with the aim of translating these new representatives into votes for Householder as speaker.
FirstEnergy Corporation makes a payment of approximately $4 million to “an entity associated with an individual who” later received an appointment regulating the FirstEnergy utilities. The timing of Chair Randazzo’s appointment and his previous work as a lobbyist suggest he is the individual mentioned in the report.
January 7, 2019
The Ohio House elects Householder as Speaker. Householder also promises to create a new standing subcommittee on energy generation, which he later fills with “Team Householder” representatives.
February 4, 2019
Governor Mike DeWine appoints Sam Randazzo, a longtime opponent to clean energy and energy efficiency, as PUCO chair. ELPC joins other environmental groups in criticizing the appointment.
April 12, 2019
“Team Householder” representatives introduce House Bill 6, which provides that a new utility ratepayer charge will subsidize nuclear power plants. The bill would provide FirstEnergy Solutions with over $1 billion in subsidies for its Davis-Besse and Perry nuclear plants.
May 29, 2019
House Bill 6 passes the Ohio House after intense pressure from Householder and his allies. The U.S. Attorney’s Criminal Complaint explains that Householder and his associates deployed a $15 million media campaign—paid for with money from “Company A.” The Criminal Complaint also alleges that Householder directly contacted legislators, including calls and texting a legislator that he “really needed him to vote yes on HB6.”
Energy efficiency is the cheapest and cleanest way to meet customers’ energy needs. It is cheaper and cleaner than nuclear power or natural gas
ELPC Senior Attorney Rob Kelter testifies before the Ohio House Energy & Natural Resources Committee and the Senate Energy & Public Utilities Committee in opposition to HB6. We urge the legislature to stand up for common-sense energy efficiency opportunities and to fix HB6 and make strong energy efficiency standards.
July 23, 2019
Ohio lawmakers pass the final version of House Bill 6, and Governor Mike DeWine quickly signs it into law. The final law eliminates Ohio’s energy-efficiency and renewable energy mandates, required ratepayers to subsidize coal plants, and gave over $1 billion of ratepayer money to FirstEnergy Solutions’ nuclear power plants.
October 22, 2019
Ohio House Bill 6 officially becomes law after a ballot initiative seeking to repeal the law fails. Generation Now also receives over $3 million from a “pass-through” group connected to FirstEnergy Corporation.
July 21, 2020
FBI agents arrest Speaker Householder, Ohio Republic Party Chairman Matt Borges, Householder adviser Jeffrey Longstreth, and lobbyists Neil Clark and Juan Cespedes. The men are charged with violating the criminal Racketeering Influenced and Corrupt Organizations (RICO) Act through wire fraud, bribery, and money laundering.
October 29, 2020
Lobbyist Juan Cespedes and political strategist Jeffrey Longstreth plead guilty to racketeering conspiracy.
November 16, 2020
FBI agents raid the home of PUCO Chair Sam Randazzo and exit with boxes of materials. The government explains only that the search was “related to a sealed federal search warrant.”
November 19, 2020
FirstEnergy Corporation submits its quarterly report to the Securities and Exchange Commission. A small section of the report explaining the termination of “[c]ertain former members of senior management” raises eyebrows by revealing FirstEnergy’s $4 million payment to “an entity associated with an individual” who became an Ohio regulator. “
November 20, 2020
Randazzo resigns from the PUCO. His resignation letter noted that the FBI raid on his home and FirstEnergy’s SEC filing would cast suspicion on his decisions as a regulator.
November 24, 2020
ELPC files a motion with PUCO to vacate orders by the commission during Sam Randazzo’s tenure as chairman involving FirstEnergy Corp. where ELPC was a party, and conduct new proceedings. The public has a right to fair decisions regarding monopoly rates and services. That fairness requires a commission’s decision process without any undue influence from the utilities it regulates.
Ohio legislators have introduced two major repeal bills. One bill would put the nuclear bailout on hold for one year while the PUCO oversees an audit to determine how much money is needed to bailout the plants. The other would repeal the funding for the nuclear plant bailout in its entirety but would not restore any energy efficiency funding and little of the renewable funding. ELPC is engaging with legislators to explain the importance of having energy efficiency and renewable energy measures and restore that critical funding. Despite public support for repealing the law, legislators have now debated how to repeal or address House Bill 6 longer than they debated whether to pass the bill in the first place.