Ohio is a national leader in energy efficiency standards. The 2008 Energy Efficiency Resource Standards, established by Senate Bill 221, require each utility to reduce demand by 22.5% by implementing energy efficiency projects and source 12.5% of power generation from renewable sources by 2025. In order to meet these goals, the utilities encourage Ohio companies like Campbell Soup Company to seek energy efficiency in their operations and incentivize investment in their own renewable energy program and strategies. The current version of Senate Bill 58, which may face a vote right after Thanksgiving, would overhaul the current state policy on energy efficiency and renewable energy standards and discourage continued investment in renewable energy in the state. It would even allow utilities to collect a tax on consumers for their energy savings. We urge the Senate to reject the legislation as drafted.
As a company, we are committed to reducing our greenhouse gas emissions by 50% per unit of production by 2020. In order to drive progress to this goal, we are implementing our own aggressive renewable energy strategy. Today, 8% of Campbell’s global electric power is being sourced by renewable energy, including 33,000 solar panels at our facilities around the world. We are actively pursuing other opportunities to reduce our environmental footprint and manage our energy cost and efficiency. This is a commitment not only to our stakeholders’ interests in sustainability; it’s a smart business move.
In addition to being a clean, domestic source of energy, renewable energy like wind and solar has no fuel cost. While the cost of electricity from coal and gas will go up and down given the volatility of the markets for those fuels, we can enter into a 20 year contract for renewable energy where we know what we’ll be paying for the electricity today and in 2033. We’ve done just that at our largest manufacturing plant in the country, located in Napoleon, Ohio.
At our Napoleon plant we helped construct a 9.8 megawatt solar field, the largest of its type anywhere. With more than 24,000 solar panels that track the sun each day from east to west, the system generates approximately 15% of the electricity to run our operations in Napoleon, the largest soup-manufacturing plant in the world.
Other corporate leaders are seeing the same value we see in renewable energy. A recent study showed that the world’s largest companies are adopting renewable energy. Indeed, well over half of the companies in the Fortune 100 have a renewable energy goal, greenhouse gas goal, or both. What the report also found is that companies are choosing to build renewable energy projects in states with strong policies. Ohio has been one of those states with the smart policies that businesses are looking for.
One important policy in Ohio is the alternative energy portfolio standard. Along with similar renewable portfolio standards in 28 other states, the alternative energy portfolio standard in Ohio has been an important driver of the adoption of renewable energy technologies. By providing an opportunity for renewable energy to compete with incumbent technologies, these policies have helped drive innovation that has lowered the cost of renewable energy. From 2009 to 2012 the cost of wind power contracts nationwide was cut nearly in half. In less than two years, the cost of solar has fallen by 60%. In Ohio, the result has been the development of numerous renewable energy projects from wind farms in western Ohio to solar across rooftops and fields around the state. It makes financial sense under the current law to invest in Ohio.
There is a question now whether Ohio will continue to provide the smart policy framework that has supported these successes. The current effort to roll back these policies is coupled with the idea that clean energy imposes undue costs on business. Based on our experience, we disagree. According to a recent analysis by Ohio State University’s Center for Resilience, the 2008 policy has saved ratepayers 1.4% since Senate Bill 221’s implementation. Total electricity demand is down 2.57% while total renewable electricity generation is up 63.76%. In further analysis, the team at Ohio State found under Senate Bill 58 Ohioans would pay $3.94 billion more for their electricity over the next 12 years, and the proposed changes to calculating energy efficiency would eliminate the current savings under SB221. They also estimate, “Ohio would lose out on over 6,500 new jobs in the renewable energy and energy efficiency sector.” Senate Bill 58 and its companion – House Bill 302 – create unnecessary headwinds for our efforts and numerous other businesses throughout the state that are finding business value in renewable energy and energy efficiency.
And, we’re not alone. Leading manufacturers like Dow and Owens Corning recently sent a letter to the leadership in Columbus expressing their opposition to the proposed changes to the alternative energy portfolio standards. The Ohio Manufacturers Association, who represents both large and small manufacturing companies across the state, strongly opposes the current bill.
We very much appreciate the interest Ohio’s lawmakers have in lowering energy costs, but undoing the smart clean energy policies that are in place today won’t help us build a stronger Ohio tomorrow.
Vice President – Public Affairs and Corporate Responsibility
Campbell Soup Company
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