PUCO staff has recommended denial of FirstEnergy’s rider proposal, a “virtual” power purchase agreement that could cost customers $3.6 billion. That’s the good news.
Staff said the proposed rider does not preserve resource diversity in the state, does not protect Ohio’s local economies from harms associated with plant closures, and could interfere with FERC’s authority over the wholesale markets.
Here’s the bad news: Staff recommended the creation of a “distribution modernization rider” that would allow FirstEnergy to annually recover $131 million from customers over the next three years. One of the stated purposes of staff’s proposal is to enable FirstEnergy’s parent company to maintain an investment grade rating. One of the conditions attached to staff’s proposal is that FirstEnergy must maintain its corporate headquarters in Akron.
So, the pretense that the proposal was to keep generating plants in operation to protect customers from future price increases is gone. It is a bailout. Just as the OMA Energy Group and others have said from the beginning.
The OMA Energy Group will continue its opposition. Customers should not be on the hook for FirstEnergy’s poor business decisions for its generation subsidiary.