Gov Strickland’s plan to boost the economy and improve energy resources includes implementation of an ‘advanced energy portfolio standard’, including benefits for renewables and other forms of generation as well as energy efficiency and security.

A key player to leverage greater use of renewables will be the Ohio Air Quality Development Authority, said the governor. Among its activities, the agency is to provide incentives to utilities for early adoption of advanced, more environmentally-friendly energy technologies.

The ‘Energy, Jobs and Progress’ plan also requires utilities to meet at least 25% of growth demand by delivering power saving efficiencies. The governor said that the efficiency efforts should equate to at least 10% of total peak demand of electricity. He added that the present system gives utilities ‘an unhealthy incentive’ to sell more power to get more revenues. Instead, the governor wants more of a focus on meeting market needs ‘with as little electricity as possible’.

Greater energy security features in the plan partly through a requirement for infrastructure modernisation at plants and transmissions lines. In pursuing that strategic aim through long-term, integrated modernisation plans, the governor has created scope for utilities to apply for localised rate differentials.

With a focus on demand-side management in relation to energy pricing, the Governor’s plan also intends the use of advanced meters for customers to see the relative cost of electricity also in terms of when it is used. The aim is to increase transparency on the variability of energy costs. That transparency will separately require any deal for special rates agreed between utilities and certain customers to be disclosed confidentially to the Public Utilities Commission of Ohio (PUCO) for its pricing reviews.

The new plan comes as the state faces at the end of 2008 the end of the rate stabilisation system, which saw PUCO keep the brakes on rising electricity prices. With the concerns over a possible jump in energy prices and frustration over the lack of a fully competitive electricity market following deregulation in 1999, the new plan aims to allow for market-based but stable pricing through provision of greater transparency, efficiency, security and environmental performance.