As Ohioans pick thru the wreckage and swelter in the dark, following last week’s severe storms – Dave Anderson, a journalist working with the utility watchdog Energy and Policy Institute has a reminder.
Federal prosecutors are still sorting out the largest racketeering and bribery scandal in the state’s history, which has already sentenced the former Speaker of the Ohio House to prison for 20 years. The affair arose in part due to First Energy, the large multistate utility that serves the area, paid bribes to Householder and several other state officials.
Hard to track where the money came from exactly, but First Energy pushed thru a half billion dollars in charges to ratepayers in recent years, allegedly to upgrade Transmission lines and reliability. Nobody knows where that money went, exactly, but it would appear it did not do much for grid resilience in large areas of the state.
Ohio Capitol Journal, January 18, 2022:
There’s no clear evidence to show the $460 million FirstEnergy Corp. charged its customers went to its stated purpose of modernizing the electric grid, a state-commissioned audit found.
After three years of FirstEnergy collecting hundreds of millions via the “Distribution Modernization Rider,” a 2019 Ohio Supreme Court ruling blocked the company from continuing to apply the charge to customer bills.
The judges found the Public Utilities Commission of Ohio, which regulates utility companies and must approve such “riders,” relied on “wishful thinking” instead of black-letter regulation to ensure the company used the money to actually modernize the grid.
So where did the nearly half a billion dollars go?
Several projects that were internally categorized as grid modernization during the relevant time frame were recovered from different funding source, “suggesting that rider DMR funds did not fund” these projects.
In a deferred prosecution agreement FirstEnergy signed with the DOJ this summer, the company admitted to two interwoven bribes awarded to obtain legal and regulatory favors for the company, which operates three Ohio utilities.
For one, FirstEnergy said it spent about $60 million, through several pass-through nonprofit entities secretly controlled by then House Speaker Larry Householder, to ensure passage of House Bill 6 in 2019. The legislation bailed out two nuclear facilities owned at the time by a FirstEnergy subsidiary and contained several other provisions favorable to the company. Householder has pleaded not guilty and awaits trial. (note: Householder is currently serving a 20 year sentence)
For two, the company said it paid utility lawyer Sam Randazzo $4.3 million, just before Gov. Mike DeWine appointed Randazzo to serve as chairman of the PUCO. Randazzo used the position to advance regulatory favors worth tens of millions to FirstEnergy, the company said. Randazzo has not been charged with a crime. (Randazzo was indicted and committed suicide prior to his trial)
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And there’s where I come in.
Randazzo, it turns out, was close chums with one of the fossil fuel industry’s foremost operatives in the Midwest, tasked with blocking clean energy development. Kevon Martis, a Senior Fellow with the Washington based, fossil funded lobbying firm E&E Legal.
Martis is well known throughout the midwest, and it’s a bit of a badge of honor to have been served, as I have, a legal threat by his big-time silk stocking Detroit law firm.
Video below shows Randazzo heaping praise on Martis, who he calls “an inspiration” and “a hero”. I’ve edited in a reality check from a Cleveland TV station. It’s all connected somehow, and it’s very fair to say that many local officials and citizens have wondered for years how Martis, or “Kmart” as we know him, funds his extensive activities.
The investigation continues.