Ohio Attorney General asked to probe Cleveland power plant deal with Prairie State Energy
Potential fraud involving Praire State plant
Ron Regan, newsnet5.com
4:07 PM, Mar 28, 2013
4:08 PM, Mar 28, 2013
CLEVELAND - Ohio's Attorney General has been asked to investigate "potential fraud" involving a multi-billion dollar coal plant supplying power to Cleveland and scores of cities across Ohio and the Midwest.
The calls for a state probe come on the heels of an exclusive 5 On Your Side investigation in July 2012 that raised serious questions about the plant's performance and impact to ratepayers.
In a letter to Ohio Attorney General Mike Dewine, Cleveland Councilman Brian J. Cummins, along with three other councilman from Gallion, Painesville and Martinsville, W.Va, are "urging" an investigation into "any potential fraud or misrepresentations" that led municipalities to enter into long-term contracts to invest in the Prairie State Energy Campus in Marissa, Illiniois.
The letter argues that "the financial impact of the project is already placing small communities under severe financial distress."
Cummins wrote that the plant promised "low-cost, affordable, reliable electricity" in return for municipalities like Cleveland to invest in the plant through bond sales.
Instead, Cummins alleges the plant is not "providing power at either its promised price or at prices that are near the current market price of power."
The deal called for states and municipalities to collectively take on $11.7 billion in debt payment.
The Ohio Attorney General's Office said it received the letter and is reviewing it.
Meanwhile, the U.S. Securities and Exchange Commission has already launched a separate investigation into how the plant was initially developed by Peabody Energy Corporation and Columbus based American Municipal Power.