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Utility company clash over energy bill led Frankfort lobbying spenders in March

Mill Creek Generating Station is a coal-fired power plant in Valley Station.
Ryan Van Velzer
/
LPM
Mill Creek Generating Station is a coal-fired power plant in Valley Station.

A bill to add new restrictions on Kentucky electric utilities seeking to retire coal-fired power plants was supported by a collection of rural electric cooperatives, but opposed by two for-profit utility companies that serve most of the state.

The biggest lobbying spenders in Frankfort last month were electric utility companies on opposing sides of a bill that would make it harder to transition away from coal-fired power plants in Kentucky.

Monday was the deadline for the hundreds of businesses and organizations lobbying the Kentucky General Assembly to file reports documenting their spending to influence legislation. The 3-month total of the session reached nearly $9 million, just shy of last year’s record.

The largest spender in March was the Kentucky Association of Electric Cooperatives, a collection of two dozen nonprofit consumer-owned utilities that successfully lobbied for Senate Bill 349 to create more restrictions on the retirement of fossil-fuel electric power units in Kentucky.

However, the next two largest lobbying spenders last month were for-profit electric utility companies on the opposite side of the issue, leading the charge against SB 349. These were Louisville Gas & Electric and Kentucky Utilities, which is the electric utility provider for the majority of Kentucky counties, and Duke Energy, which serves six counties in northern Kentucky.

The bill that is now in effect creates a new state commission packed with representatives of the fossil fuel industry, which will deliver detailed reports to the Public Service Commission whenever a utility company requests to retire a coal-fired power plant. It also comes on the heels of a new law passed in 2023 that requires PSC regulators to prove any retirements won’t jeopardize the reliability of the electric grid — which was also unsuccessfully opposed by the two for-profit utility companies.

The Kentucky Association of Electric Cooperatives reported spending $81,834 to lobby for SB 349 last month, $66,576 of which were used on an advertisement campaign to pass the bill and “support efforts to protect reliable affordable power in Kentucky.” The organization spent $118,885 lobbying through the first three months of the session, placing it third among all groups.

Top 10 legislative lobbying spenders, January-March 2024

  1. Kentucky Chamber of Commerce — $151,010
  2. ACLU of Kentucky — $139,599
  3. Kentucky Association of Electric Cooperatives, Inc. — $118,885
  4. LG&E and KU Energy LLC — $106,117
  5. Pharmaceutical Care Management Association (PCMA) — $94,693
  6. Duke Energy — $86,576
  7. Kentucky Hospital Association — $85,834
  8. Kentucky League of Cities, Inc. — $85,109
  9. Greater Louisville, Inc. — $82,100
  10. East Kentucky Power Cooperative Inc. — $79,507

They were joined in the lobbying effort for the bill by the East Kentucky Power Cooperative — another collective of 16 nonprofit electric co-ops in eastern and central Kentucky — which spent $33,616 in March and $79,507 total for the session, placing it in the top 10 of lobbying spenders.

The electric cooperatives’ lobbying messaging matched that of its Republican sponsors, arguing that utility companies were moving too fast to move coal-fired plants off the grid and that other forms of energy are not as reliable and could lead to blackouts when there is extreme weather.

LG&E/KU spent $64,764 lobbying against SB 349 in March and Duke Energy was just behind it with $54,934. The two utility companies combined to spend $73,000 on ads that month opposing the bill, which included social media and digital targeting. They also reported collectively spending nearly $200,000 through the first three months of the session, picking up fourth and sixth place in overall spending.

The companies’ lobbying efforts argued the bill would create unnecessary red tape for them to deal with and add pressure to keep old and inefficient power plants in operation, which would ultimately lead to higher prices for ratepayers.

Democratic Gov. Andy Beshear made similar arguments in his veto of SB 349, saying it counters his “all of the above” energy policy and would create “inordinate delays in authorizing new generation, which will jeopardize economic development.”

The bill had the votes to succeed – both in the chambers and in the veto override. A significant number of Republicans broke ranks to vote against it, along interesting geographic lines. All seven GOP House members from Boone, Kenton and Campbell counties in northern Kentucky, where Duke has the most customers, voted against SB 349, as did all but one House Republican from Jefferson County, the largest customer base for LG&E.

The Kentucky Coal Association and other groups from the fossil fuel industry also lobbied in favor of SB 349. The groups making up the coalition against the bill were more broad, including environmental groups, the solar industry, the United Way, the U.S. Chamber of Commerce and four local chambers of commerce, including those representing Louisville and northern Kentucky.

Last fall, the Public Service Commission approved LG&E/KU’s request to retire two coal-fired electric power units in Jefferson County, but denied their request to shut down coal-fire units in Trimble and Mercer counties. It was the first test of the new 2023 law.

The push to make it harder to retire coal-fired plants comes as the world’s leading climate scientists warn urgent action is needed to reduce the planet’s reliance on fossil-fuel energy.

Kentucky chamber keeps #1 spending spot

The Kentucky Chamber of Commerce remained the top lobbying spender through the first three months of the session, with most of its $151,010 spent on compensation for its 14 registered lobbyists.

The statewide business advocacy group has now reported spending more than $144,000 on its lobbyists, which is nearly twice what the next-highest organization spent.

Among the business-friendly bills the chamber successfully pushed to passage in March — and into law in April, when the legislature overrode Beshear’s vetoes — were House Bill 7 to allow driverless vehicles on Kentucky roads by this summer and House Bill 136 to limit the power of Louisville’s air pollution regulatory agency.

Greater Louisville Inc., the chamber of commerce for Metro Louisville, reported spending $82,100 to lobby lawmakers through the first three months of the session, placing it ninth among all groups.

GLI joined the statewide chamber in support of HB 7 and HB 136. It lobbied on House Bill 388 to make Louisville’s local elections nonpartisan and mandate other changes to city spending and services, but was not publicly for or against the bill.

The Louisville chamber did take a clear stance against SB 349, the energy bill opposed by LG&E/KU, and also expressed concern to lawmakers about Senate Bill 6, a sweeping bill to prohibit diversity, equity and inclusion measures at public universities. The anti-DEI bill came up just short of passage on the final day of the session this week.

Pharmacy benefits manager spend big in losing effort

The top spender on advertisements intended to lobby lawmakers on bills through the first three months of the session was the Pharmaceutical Care Management Association, a trade group of pharmacy benefit managers that act as prescription drug insurance middlemen.

The group spent another $35,000 in March on statewide digital ads and phone calls targeted at specific legislative districts in opposition to Senate Bill 188, which adds restrictions on pharmacy benefits managers in the hopes of helping independent pharmacies stay afloat financially and improving patients’ access to medications.

Lobbyists and ads for the PCMA said SB 188 could raise insurance premiums by as much as $25 a month. The bill passed nearly unanimously at the end of March and was signed into law by Beshear.

Hospitals, cities and ‘Safer Kentucky Act’

The Kentucky Hospital Association reported spending $85,834 through March, spending more on lobbyist compensation than any group other than the Kentucky Chamber.

The hospital advocacy group lobbied for Senate Bill 27 to ensure pharmaceutical companies give hospitals prescription discounts under a federal program, but the bill stalled in the House after clearing the Senate in March.

The Kentucky Hospital Association was successful in blocking two bills it opposed from passage. House Bill 204 intended to lift certificate of need requirements in order to open new health care facilities, but it never received a committee hearing. House Bill 199 to allow freestanding birthing centers stalled in the Senate after clearing the House by a 69-25 vote.

The Kentucky League of Cities also spent more than $85,000 on lobbying through the first three months of the session, with its 15 registered lobbyists pushing lawmakers on dozens of bills related to local governments.

The ACLU of Kentucky was second only to the statewide chamber in total lobbying spending through March, spending $139,599 on a mix of its lobbyists, their travel costs and advertisements opposing House Bill 5, the sweeping anti-crime bill dubbed the “Safer Kentucky Act.”

Despite the $31,719 spent on billboards, digital and radio ads opposing HB 5, the bill passed the legislature in March and then had Beshear’s veto overridden in April.

The ACLU of Kentucky also successfully lobbied against the anti-DEI SB 6, as well as Senate Bill 147 to restrict drag shows, House Bill 47 to void local anti-discrimination laws to protect LGBTQ+ residents and Senate Bill 239 to create a "conscience clause” for medical workers to deny care to patients based on moral objections.

The final legislative lobbying reports for the 2024 session are due next month, which will detail organizations’ lobbying efforts during most of the governor’s veto period and final two days of the session in April.

Joe is the enterprise statehouse reporter for Kentucky Public Radio, a collaboration including Louisville Public Media, WEKU-Lexington, WKU Public Radio and WKMS-Murray. Email Joe at jsonka@lpm.org.
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