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FirstEnergy cuts backroom deal with PUCO, sticking consumers with the tab

Trish Demeter, Chief of Staff, December 1, 2015


Whoever said giants can’t do acrobatics, and government regulators never bend hasn’t been following the heated debate around the coal bailout cases happening in Columbus.

In a matter of months, utility giant FirstEnergy flipped from lobbying hard for competitive energy markets to desperately seeking the, um, “financial security” of an anti-competitive deal at the Public Utilities Commission of Ohio (PUCO).

This “deal” is decidedly bad for Ohio families. It would require people in FirstEnergy’s service area to pay extra on their electricity bills to keep several of our state’s oldest and dirtiest power plants open for 8 more years. It would also guarantee continued profits for FirstEnergy on several plants that would otherwise go out of business. This is corporate welfare at its worst.

Following months of public hearings that saw Ohioans turn out in droves to demand that the PUCO reject FirstEnergy’s money grab, FirstEnergy and PUCO staff have crafted a whopper of a sweetheart deal for FirstEnergy.

For more background on this issue check out my previous article “a closer look at the outrageous plan to derail Ohio’s clean energy future.” Just be forewarned, if you don’t like handing out your cold hard cash to a monopoly company that would rather rely on an inferior product and an outdated business model than innovate and invest in the future, you may want to grab a paper bag to breathe into after you’re finished. A quick review of today’s settlement proposal reveals numerous flowery provisions portraying the proposal as environmentally friendly. Here are three of the main provisions of the settlement that attempt to greenwash this dirty energy deal.

1.  “Commitment to Environmental Stewardship”

The proposed settlement includes a company-ballyhooed “Commitment to Environmental Stewardship” and a goal to reduce carbon dioxide pollution by 90% by the year 2045, regardless of whether the USEPA’s Clean Power Plan endures the legal challenges against it. This sounds great – a goal of reducing carbon pollution by 90% coming from a company with many large carbon polluting power plants is a big thing.

However, this 30-year “commitment” is completely unenforceable. There is no guarantee they’ll follow through, and no penalty imposed if they don’t meet the goal. This is not to say there aren’t any 100% guarantees in this proposed plan. Guaranteed profits – to the tune of 10.38% – are spelled out in black and white – for FirstEnergy’s shareholders.

2.  “Unlocking Energy Efficiency”

Next, the settlement includes a provision aimed at “Unlocking Energy Efficiency” by reactivating its suspended energy efficiency programs. Sounds like a victory for energy efficiency advocates, right? Especially since it was FirstEnergy that led the fight to pull the plug on Ohio’s efficiency standard last year. But, again, the devil is in the details.

Upon closer read of this provision,  you see that the company is less interested in offering robust and cost-effective energy efficiency programs and more concerned with getting credit for energy-saving measures its customers have taken the initiative to undertake on their own, with no help from the utility! That’s right, FirstEnergy wants to charge you money to take credit for what you’re doing already. Try wrapping your head around that logic.

Worse still, the settlement goes out of its way to talk up the supposed huge reductions FirstEnergy will make because of these energy efficiency programs. But the reality is that these savings pale in comparison to what could be saved right now if Ohio’s energy efficiency standard wasn’t currently “frozen.”

3.  “Increase Renewable Resources”

At a time when the competitive market is transitioning to a cleaner energy future, saying you will invest in new renewable energy projects is really the least you could do. Well, that is exactly what this deal provides… the absolute least.  The deal proposes “up to 100 Megawatts” of wind or solar energy, but only “to the extent [PUCO] Staff deems it helpful to comply with a future federal or state law or rule, and, to the extent such federal or state law or rule has not fostered the development of new renewable energy resources.”

Translation: FirstEnergy is not committing to any sort of enforceable, substantial steps to increase clean energy in Ohio. While the text says 100 Megawatts, in reality FirstEnergy is committing to more like 0 Megawatts of clean energy in this proposed settlement.

So, after more than a year of public hearings, thousands of citizens calling for its rejection, countless legal hearings and expert testimony, FirstEnergy has made precious few concessions on this stinker of a proposal. Instead, they’ve sought to greenwash their plan behind a lot of legal jargon that ultimately commits them to nothing while ensuring them a handsome profit at your expense.

In a nutshell, the additions to the bailout proposal make the scheme more anti-consumer, more anti-competitive, and more anti-environment than originally proposed.

You have to give them credit. When First Energy initially proposed its bailout, we didn’t think it could get any worse. Turns out we were wrong.

Now, here’s the good news – this isn’t over yet. This proposed settlement is exactly that, a proposal. The PUCO has yet to approve it. If you’re as fired up as we are at this preposterous proposal, tell the PUCO to say “Heck No” to this settlement.

Submit your comments to PUCO Chairman Andre Porter, today!