Due to the House Alternative Energy committee meeting being cancelled Wednesday, May 2, we did not get an update from GCP’s Gary Smith last week. The General Assembly (specifically, the Ohio House of Representatives) was preoccupied with passing the 2008-2009 biennial state operating budget (http://www.legislature.state.oh.us/bills.cfm?ID=127_HB_119). Many hearings were cancelled in its wake, including Alternative Energy. But today Gary is back with another report:

May 14, 2007—House Alternative Energy Report

After a week off, the Alternative Energy committee returned to hear compelling testimony from several witnesses. Among the witnesses were Rayola Dougher, an economist with the American Petroleum Institute (http://www.api.org/); Amy Gomberg, an environmental advocate for Environment Ohio (http://www.environmentohio.org/); and Dale Arnold the director of energy services for the Ohio Farm Bureau (http://www.ofbf.org/). Gomberg and Arnold spoke almost exclusively about the prospects and promises of wind energy while Dougher provided the oil industry’s thoughts on biofuels.

Ms. Gomberg of Environment Ohio expressed an opinion that Ohio is too dependent on expensive, imported energy sources. One example she gave to illustrate this conclusion is that in 2005, Ohio sent over $8 billion out of state to import coal and natural gas. Additionally, she submitted that Ohio imports the majority of the energy resources used to generate our electricity (57% of our coal is imported; 89% of natural gas is imported).

Her conclusion: We can keep more of Ohioan’s hard-earned dollars in state by harnessing our own wind resources—this strategy will also create much-needed jobs and boost the economy. In addition to being a “clean energy”, Gomberg praised the other positive benefits of wind energy: creator of manufacturing jobs, new business opportunities, rural economic development and decrease in energy dependence. Her conclusion is that Ohio has the technological know-how, manufacturing base, and wind energy potential to generate at least 10-20% of our electricity needs from wind energy—and it can happen in the next decade. Gomberg also implored the committee to go down the path of setting a renewable energy standard for Ohio. To read more about Ms. Gomberg’s comments and Environment Ohio, visit http://www.environmentohio.org/.

Mr. Arnold echoed much of what Ms. Gomberg said. According to Arnold, next to labor, energy is the largest single input on most farms. Consequently, Ohio Farm Bureau members are very concerned about rising energy costs. Ohio Farm Bureau members support a diversified energy portfolio. As an organization, they seek to provide leadership to develop wind, solar, biomass, fuel cell, geothermal and low impact hydro technology. Additionally, according to Mr. Arnold, OFB members support clean coal technologies and use of local gas and oil production to help address Ohio’s energy needs.

According to Arnold, the most important issue with respect to wind energy is interconnection—a relationship between the utility and the consumer. This relationship includes On-site generation, smart metering, distributed generation, net-metering, and stand-by rates. To learn more about OFB and energy, visit their website at http://www.ofbf.org/.

The testimony of Rayola Dougher, an economist with the American Petroleum Institute, was predictable. Dougher blamed the current gas prices on low inventories and regional refinery outages. Those refineries were not identified. Refinery utilization, according to the API, is at 88%–they should be at 92%. So, that difference of 4% (presumably coupled with larger demand) accounts for prices of $3-plus a gallon? Forgive me if I seem skeptical…

Dougher made the obligatory statement that “Our nation needs ALL (emphasis added) sources of commercially viable energy, as well as greater commitment to energy efficiency and energy conservation.” Visit http://www.api.org/ for more information on the petroleum industry’s thoughts on energy.

This week, the House Alternative Energy committee meets at 11:00 am in Room 122 at the statehouse in Columbus. Testimony is expected from Jim O’Neil of Whirlpool (http://www.whirlpoolcorp.com/) and Ken Alfred of the Ohio Fuel Cell Coalition (http://www.fuelcellsohio.org/).

You can reach Gary Smith, Director f Government Affairs, directly at: gsmith@gcpartnership.com