In what was a busy day for rulings, the Public Utilities Commission of Ohio (PUCO) on March 31 adopted with modifications stipulations to the electric security plan (ESP) for FirstEnergy (NYSE:FE)’s Ohio distribution utilities.
The PUCO order modifies the stipulation to limit bill increases. The ESP also promotes a modernized grid and continued customer shopping for electricity. The plan will ultimately determine the standard service offer (SSO) from June 1, 2016 through May 31, 2024, PUCO said in a news release.
The order came on the same day as PUCO issued its decision in another closely-watched case involving American Electric Power (NYSE:AEP).
“The Commission order strikes the highly challenging balance between consumers’ interests in cost-effective electric service and the vested interests of other diverse stakeholders,” said PUCO Chairman Andre T. Porter. “Today’s opinion and order affirms Ohio’s commitment to encourage a modernized grid and retail competition.”
Among other things, FirstEnergy has established a goal of a 90% carbon emissions reduction from 2005 levels by 2045 and over 800,000 megawatt hours (MWh) of annual energy savings through a restart of energy efficiency and peak demand reduction programs.
Additionally, FirstEnergy has committed to submit a plan to procure at least 100 MW of renewable resources, PUCO said in its news release.
Eight-year power contract included for nuclear, coal units
FirstEnergy’s Ohio utilities expect to file new rates with the PUCO by May 2, following the completion of a competitive auction process to buy electric generation supply for their non-shopping customers. FirstEnergy expects that the vast majority of its Ohio utility customers will see lower total bills after these auctions.
FirstEnergy said in a news release that it is pleased with PUCO’s approval, with certain conditions, of its “Powering Ohio’s Progress” plan.
The approved plan is the result of a comprehensive settlement reflecting the diverse interests and concerns of 17 signatories, including the PUCO staff and parties that represent residential, low-income, commercial and industrial customers, as well as competitive energy suppliers, schools and organized labor, FirstEnergy said.
The plan will establish electric service for customers of FirstEnergy’s Ohio utilities – Ohio Edison, Cleveland Electric Illuminating and Toledo Edison – over an eight-year period from June 1, 2016 through May 31, 2024.
It outlines a series of steps to help safeguard customers against rising energy prices in future years, and helps preserve key power plants that serve Ohio customers, FirstEnergy said.
The plan outlines a new retail rate stability provision related to a proposed eight-year Purchased Power Agreement (PPA) with the Davis-Besse Nuclear Power Station in Oak Harbor, Ohio, the W.H. Sammis Plant in Stratton, Ohio, and a portion of the output of Ohio Valley Electric Corporation (OVEC) units in Gallipolis, Ohio, and Madison, Ind.
FirstEnergy said the arrangement will keep a diverse set of fuel sources available to generate electricity, rather than risking more plant closures that put our region at risk of higher energy prices in the years ahead.
“Today’s decision will help protect our customers against rising electric prices and volatility in the years ahead, while helping to preserve vital baseload power plants that serve Ohio customers and provide thousands of family-sustaining jobs in the state,” said Charles E. Jones, FirstEnergy President and CEO. “The plan will also extend FirstEnergy’s longstanding support for the customers and communities we are privileged to serve in Ohio, through a comprehensive settlement reached between our utilities and a broad array of stakeholders.”
FirstEnergy must submit a grid modernization plan to the PUCO.
The FirstEnergy case in Ohio is No.14-1297-EL-SSO.