FirstEnergy Stuns with New Ask for Subsidy

07/29/2016

This week, in response to a proposal submitted by the Staff of the Public Utilities Commission of Ohio, FirstEnergy filed another customer-paid subsidy proposal to the PUCO asking regulators to approve more than $4.46 billion in above-market customer charges over the next eight years as a subsidy to buffer FirstEnergy’s precarious balance sheet. Energy lawyers participating in the proceedings this week were shocked to learn that in addition to requesting $558 million annually from customers ($4.46 billion over an eight-year term) for credit support for FirstEnergy Corp., FirstEnergy is seeking an additional customer surcharge in exchange for FirstEnergy Corp.’s commitment to maintain its corporate headquarters and nexus of operations in Akron, Ohio.  This additional charge could cost customers up to an additional $568 million per year for eight years.  If approved, FirstEnergy’s new proposal could cost FirstEnergy’s Ohio distribution customers up to $1.126 billion per year ($558 million + up to $568 million) for eight years. FirstEnergy testimony states that: “The annual amount would equal the $558 million associated with the credit support of jump-start grid modernization and the additional amount not [to] exceed the economic development value outline[d] by Company witness Sarah Murley arising from having the FirstEnergy Corp. headquarters and nexus of operations in Akron, Ohio.”  In her testimony, Ms. Murley quantifies the economic development value at $568 million per year. The OMA Energy Group has been litigating against unjustified customer paid subsidies.  Tom Lause, VP, Treasurer, Cooper Tire & Rubber Co., recently testified in opposition to a FirstEnergy aid package proposed by PUCO staff.  Contact OMA’s Ryan Augsburger to learn more how your company can support the effort to protect Ohio manufacturing competitiveness.

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