Former Republican Ohio House Speaker Larry Householder is headed to the Big House. A federal judge June 29 sentenced Householder to 20 years in prison for his central role in a racketeering conviction involving a $1.3 billion legislative bailout (HB 6) of two FirstEnergy uneconomic nuclear power plants, which provided Householder about $60 million before he was ousted as a political commissar.
In sentencing Householder to the maximum penalty, U.S. District Court Judge Timothy Black ordered U.S. Marshalls to take Householder into custody. He was cuffed and led away.
Black blasted Householder for shepherding the legislation through Ohio’s complaisant House, which raised customer rates to keep the Davis-Besse and Perry nuclear plants operating after they failed to compete in the PJM Interconnection’s capacity auctions. FirstEnergy also played a key role in defeating a citizen referendum attempting to overturn HB 6.
Black said Householder’s racketeering took money away from electric customers that could have been used for health care, education, or other worthwhile expenditures, in what was the largest electric utility bribery case in U.S. history. “You handed that money to suits in private jets,” Black said. “You conned the people of Ohio and you tried to con the jury, too.”
An angry Black said Householder committed perjury during his criminal trial that ran from January to March. Ohio Capital Journal wrote, “Householder claimed to barely know FirstEnergy executives as federal prosecutors put on a mountain of evidence that Householder flew on their corporate jets, sat in their luxury boxes and dined in fancy restaurants as they plowed tens of millions of the corporation’s dollars into dark-money accounts.”
In addition to bribing Householder, FirstEnergy also financed the defeat of the repeal referendum, and supported election of Republicans to the House in 2018, who then named Householder speaker in 2019. Householder used the bribery money to pay off credit card bills, settle a lawsuit, and repair a house he owned in Florida.
The day after he sent Householder to the slammer, Black sentenced the former head of the Ohio Republican Party, Matt Borges, to five years in prison for his role in the dark money scheme. Black directed the same sort of castigation at Borges that he had applied to Householder. He said, “We reap what we sow, we sleep in the bed we’ve made, we pay the dues that we have earned. The court and the community’s patience with all of this case … has expired.”
Because of a Republican supermajority in the Ohio legislature, efforts to fully repeal HB 6 failed. In March 2021, Gov. Mike DeWine signed a partial repeal, which ended the nuclear subsidies. Both Davis-Besse and Perry are still generating power. The subsidies remain in effect for two uneconomic 1950s-vintage coal-fired plants.
The Ohio Capital Journal reported that following a year of small bill credits, Ohio customers of Ohio Valley Electric Corp. (OVEC), owned by American Electric Power, AES, and Duke Energy, PPL, Vectren, and FirstEnergy will begin paying to keep the plants in service, beginning this month. The 1,000-MW Kyger Creek plant in Ohio and 1,300-MW Clifty Creek plant in Indiana were both bailed out in HB 6.
Customers were getting a small bill credit because of a short-term increase in global natural gas and coal prices as a result of the war in Ukraine. Now, that situation has reversed, and rate payers will see bill increases. A study by the Ohio Manufacturers Association, which supports full repeal of HB 6, found “Ohioans have already paid nearly $400 million to OVEC’s utility owners. The study estimates customers will subsidize OVEC’s utility owners around $850 million by 2030. Meanwhile, the power plants are at risk of major environmental upgrades, which would further increase costs to Ohioans.”
In another development concerning Akron-based FirstEnergy, California energy watchdog group Energy and Policy Institute (EPI) said it has found evidence that between 2018 and 2020, the utility secretly funded a group called “Consumers Against Deceptive Fees” in a campaign to kill Cleveland Public Power, a city-owned utility that competes against the investor-owned company.
Based on bank records the Cleveland City Council received as a result of a subpoena and the watchdog group obtained through an Open Records Law filing. EPI said $550,000 of FirstEnergy funds went to the group opposing the municipal utility. Much of that money. $158,000 went to an Ohio “law firm Roetzel & Andress and $87,000 to the firm’s lobbying arm, Roetzel Consulting Solutions (RCS), in 2019-2020.”
Roetzel also worked on the campaign to enact HB 6 and Matt Borges was affiliated with Roetzel, although EPI presented no evidence that Borges worked on the Cleveland muni project.
–Kennedy Maize