A new proposal in the Ohio House would provide a perpetual subsidy for two coal-fired power plants owned jointly by American Electric Power and just about every other major electricity utility in the state.

House Bill 239 calls for the owners of Ohio Valley Electric Corp. to receive a guarantee of income at times when the market price of electricity is less than the cost to operate the power plants. That money would come from a charge to consumers.

If the market shifts and the plants become profitable, customers would receive a credit.

The Public Utilities Commission of Ohio already has approved a similar plan for AEP, which leads to a varying monthly charge that is now about $2 per month for a typical household.

The legislation would take the PUCO's action, which needs to be re-approved every few years, and make it last for the remainder of the life of the plants — which could be decades. Also, the bill would provide benefits to all Ohio Valley Electric co-owners in the state, not just AEP.

There has been debate about having a similar arrangement for other Ohio plants owned by AEP and FirstEnergy, an idea opposed by consumer advocates, environmentalists and others. The opponents say that the subsidies distort the market and extend the life of plants that otherwise would face pressure to close.

This proposal is much narrower, covering just the two plants.

"(Ohio Valley Electric) is, for lack of a better term, an anomaly," said Rep. Rick Carfagna, R-Genoa Township, a co-sponsor, speaking to the House Public Utilities Committee on Tuesday.

He was referring to its unusual origins and its ownership by more than a dozen parties in several states.

Ohio Valley Electric was founded in the 1950s to provide electricity for the uranium-enrichment facility near Portsmouth. The enrichment site has since closed, but the two coal-fired power plants remain in operation.

AEP owns 43 percent of it, more than any other company. The other owners include Buckeye Power, which serves rural electric cooperative utilities, and several other large, investor-owned utilities, such as FirstEnergy, Duke Energy and Dayton Power and Light.

The power plants are Kyger Creek in Cheshire, which went online in 1955 and can generate about 1,100 megawatts, and Clifty Creek in Madison, Indiana, also started in 1955 and with a capacity of about 1,300 megawatts.

A megawatt is enough electricity to provide for about 1,000 houses.

The Office of the Ohio Consumers' Counsel is still reviewing the bill and hasn't offered an opinion.

However, Dan Doron, a spokesman for the consumer advocate, observed in an email that "Ohio consumers already pay higher electric rates than residents in 33 other states.

"Unfortunately, the electric utilities continue to ask state government for subsidies that increase Ohioans’ monthly bills."

dgearino@dispatch.com

@dangearino