Study: Ohio Energy Mandate Will Cost State Billions

A majority of states have Renewable Portfolio Standards (RPS)—energy mandates that require utilities to produce or purchase a certain amount of electricity from renewable sources, such as wind and solar. These costly regulations have detrimental impacts on employment, income, and investment, leading policymakers in several states to take steps to either freeze or eliminate their renewable mandates.

Ohio’s RPS, passed in 2008, requires utility companies to source at least 12.5 percent of their electricity from renewable sources by 2025 (intervening years have lower requirements that build over time). Ohio froze its standard for two years while a committee investigates its economic effects, but a new study from the Institute of Political Economy at Utah State University has found that the RPS will have a resoundingly negative impact on the state’s economy.

Cost of Ohio’s Energy Mandate

Supporters justify renewable mandates by measuring the supposed benefits associated with reducing carbon dioxide emissions, but there is limited data on the costs of these regulations on ratepayers. A new study sheds some light on those costs.

The Institute of Political Economy quantified the cost of Ohio’s RPS on the state economy, finding that, by 2026, the renewable mandate will:

  • There were 29,366 fewer jobs in Ohio at the end of 2014 than there would have been without the RPS in place.
  • A family in Ohio made $3,842 less in 2013 than they otherwise would have had the RPS not existed.
  • Ohio families could potentially face $1.92 billion increase in electricity costs beyond what they would have paid in the absence of an RPS.

Action in Other States

Given the starkly negative economic effects of the RPS, it is unsurprising that other states are taking steps to freeze or repeal their standards, reflecting the growing momentum against these costly regulations.

West Virginia became the first state in the country to fully repeal its RPS in January, and Kansas followed suit in May. Colorado, Texas, and New Mexico have all passed legislation in at least one chamber to revise or repeal their RPS, and legislation has been introduced in North Carolina to freeze its renewable mandate.


In light of the negative impacts highlighted by the Institute of Political Economy’s study, Ohio’s lawmakers should follow through with a full repeal of its RPS. The costs of RPS on state economies far outweigh their ambiguous benefits, and all states should reconsider renewable mandates before the worst of the economic damage sets in.

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