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Former top Ohio utility regulator was involved with writing tainted nuclear bill, emails show

COLUMBUS, Ohio – While serving as Ohio’s top utilities regulator, former Public Utilities Commission of Ohio Chairman Sam Randazzo worked to amend a controversial nuclear bailout bill to hurt renewable energy projects while helping a former client that had just lost a major court case, recently released emails show.

Records released by the Ohio House last month show Randazzo in emails to House staff suggested wording revisions to an early version of House Bill 6, which now is at the center of a federal corruption probe, along with other minor later changes to the bill language.

But they also show Randazzo helped develop new language for the bill to make it harder for wind energy projects to get exceptions to “setback” rules requiring a certain amount of distance between windmills and adjoining properties. The language, drafted as an amendment that didn’t make it into the final bill, would have benefitted Randazzo’s former client, a group of Huron County property owners who were fighting state approval for a wind farm. Randazzo had filed the case with the Ohio Supreme Court, and had withdrawn from the case six months before when Gov. Mike DeWine hired him as Ohio’s top utility regulator.

Renewable energy advocates, who long have criticized Randazzo, say his involvement with House Bill 6 was inappropriate, given his role approving energy projects and setting utility rates. They’ve also questioned his impartiality in light of FirstEnergy’s disclosure that Akron power company paid $4 million to someone matching Randazzo’s description shortly before DeWine hired him. Randazzo as PUCO chairman subsequently issued rulings that benefitted FirstEnergy, including one in November 2019 that rescinded a requirement that FirstEnergy undergo a comprehensive review of its electricity rates in 2024. The company was a driving force behind House Bill 6, which otherwise bailed out two Ohio nuclear plants owned by a former FirstEnergy subsidiary.

Randazzo resigned from his job leading the PUCO in late November, the same week the FBI searched his house in Columbus, and the day after FirstEnergy disclosed the $4 million payment, which prompted the company to fire its then-CEO and two other senior executives. The FBI has not said why they searched Randazzo’s house, and he hasn’t been charged or accused of wrongdoing.

“It is clear from these emails that Sam Randazzo, while employed as the top energy regulator in the state of Ohio, assisted in writing components of House Bill 6, and specifically pieces of that legislation that would impede development of wind energy and damage the renewable portfolio standard,” said Miranda Leppla, vice president of energy policy for the Ohio Environmental Council Action Fund. “It is absolutely inappropriate for someone charged with being an independent arbiter of energy policy for the state of Ohio to be involved in drafting legislation that picks winners and losers in the types of generation operating in our state. His job as chair of the PUCO was to implement the law–not create it.”

Randazzo did not respond to a message seeking comment, and a House spokeswoman said the messages speak for themselves.

The emails from Randazzo were contained in a batch of thousands of pages of records that included text messages, memos, proposed law changes and other files provided to the FBI in response to a subpoena seeking records on HB6, a nuclear bailout bill that’s at the center of a federal corruption probe. Cleveland.com and The Plain Dealer obtained the records as part of a public records request. Energy News US was the first to report that they showed Randazzo offered input on HB6.

In a July 5, 2019 email to Pat Tully, then a top House policy staffer, Randazzo complained to Tully about an Ohio Supreme Court decision from two weeks before that ruled against a case he brought while serving as a private attorney, saying the court decision “rewrote” the setback limits as they apply to wind farms. He said the proposed changes would address the core issue the court ruled against, and also might overcome opposition from the state Senate to a related House anti-wind energy provision in the bill.

At the time, the version of HB6 passed by the House would have allowed townships to hold a referendum vote to block wind farm projects. The Senate apparently didn’t favor the provision, which Tully in an email to Randazzo described as a possible “poison pill.”

“If the House language establishing a referendum option… is not viable moving forward, there are alternative means to giving local interests more control,” Randazzo wrote.

Randazzo, a longtime energy lawyer, had filed the case in January 2017, representing a coalition of property owners in Huron County who challenged a state approval of a wind farm there. He withdrew in January 2019, shortly before DeWine hired him to run the PUCO, which approves energy projects and regulates utility rates throughout the state.

Randazzo suggested language requiring adjoining property owners to approve any waivers to setback rules, according to the email.

“With these changes, all owners of property adjoining the wind farm project area would need to waiver the application of the minimum setback violations(s) before the wind farm could evade the minimum setbacks (The result which I believe was intended by the GA [General Assembly]),” Randazzo wrote in the email.

Randazzo used a private email address associated with the Sustainability Funding Alliance of Ohio, a company he owns, to send the proposed setback law changes to Tully’s private email address.

Later that morning, Tully sent an email directing the Legislative Service Commission, the nonpartisan organization that writes and researches laws for the state legislature, to draw up the new wind farm setback language as an amendment, describing it as a “House Bill 6″ concept, House records show.

The wind setback change proposed by Randazzo didn’t make its way into HB6. The referendum language was introduced as a standalone bill, House Bill 401, but the proposal never made it out of committee, receiving its last hearing in November 2019.

Shortly after he proposed revisions to an early version of House Bill 6, Randazzo also in April 2019 emailed then-House Speaker Larry Householder, who pushed the bill through the legislature, commenting on objections raised by the Ohio AARP that the bill would raise electricity rates for consumers.

“Regardless of the clean air benefits of HB6, HB6 reduces the current mandate cost burden on customers and is better for Ohio customers than the status quo,” Randazzo wrote.

Federal officials are investigating House Bill 6 and say it was passed in exchange for $61 million in bribes from FirstEnergy, although the company hasn’t been charged or officially named in charging documents.

In exchange for the money, used on political spending that helped Householder become Ohio House speaker and defend the law against a repeal effort, federal prosecutors say Householder agreed to pass HB6 and help keep it in place.

Householder has pleaded not guilty to a federal corruption charge and denied wrongdoing. He has been ousted as speaker, but remains in the legislature and was re-elected in November.

DeWine is the process of picking Randazzo’s replacement, narrowing the process down to four finalists. Leppla said the documents showing Randazzo was involved with writing HB6 provide “further evidence that when Governor DeWine is selecting a new PUCO chair and additional commissioners over the next few months, he must select someone with no connection to the utilities the PUCO regulates.”

The emails contained in the House records show others were closely involved in writing House Bill 6, particularly lobbyists for American Electric Power, FirstEnergy and Energy Harbor, the company formerly known as FirstEnergy Solutions.

The bill, now law, will send more than $1 billion to two financially troubled Ohio nuclear plants owned by Energy Harbor, $50 million annually two coal-fired plants co-owned by AEP, Duke Energy, and Dayton Power & Light, and $20 million for three solar projects.

It also includes a “decoupling” provision requested by FirstEnergy that critics say will send the company a total of $355 million more through 2024 by guaranteeing the company a yearly revenue of at least $978 million.

House Bill 6 pays for the new subsidies, tacked on to most Ohioans’ electricity bills, by gutting different ones that paid for renewable-energy projects and energy-efficiency programs.

DeWine and legislative leaders have called on HB6 to be repealed, given what prosecutors say is its corrupt origins. But state lawmakers have failed to repeal the bill, disagreeing on what specifically should be done with it.

The nuclear fees in HB6 were to have taken effect in January. But the Ohio Supreme Court has delayed them while it considers a challenge filed by the Ohio Manufacturing Association.