Comprehensive Settlement with Majority of Parties Achieved on Mon Power and Potomac Edison Generation Transaction
FAIRMONT, W.Va., Aug. 21, 2013 /PRNewswire/ -- FirstEnergy Corp. (NYSE: FE) subsidiaries Mon Power and Potomac Edison, along with the majority of the parties to the companies' generation transaction proceedings involving the Harrison Power Station, today filed a comprehensive settlement agreement with the Public Service Commission (PSC) of West Virginia, which, if approved, would be expected to reduce an average residential customer's electric bill by about $1.50 a month.
The settlement agreement also includes the companies' commitments to bring more jobs to the state, and provides financial contributions for economic development, weatherization programs, low-income assistance for paying utility bills, and an education program designed to promote energy efficiency initiatives in West Virginia public schools.
Parties signing the settlement agreement include: the PSC Staff; the Consumer Advocate Division; the West Virginia Energy Users Group; the Utilities Workers Union of America, AFL-CIO and its Local 304; the West Virginia State Building and Construction Trades Council, AFL-CIO; the West Virginia Coal Association; and Local Union 2357 of the International Brotherhood of Electrical Workers, AFL-CIO.
"We appreciate the support of the parties in reaching this agreement, and look forward to implementing our cost-effective plan to provide our customers with electricity generated in the heart of our service territory," said Holly Kauffman, president of FirstEnergy's West Virginia operations. "Having 100 percent ownership of the Harrison Power Station will help shield our customers from unpredictable spot market prices and help provide greater rate stability for years to come."
Under the terms of the agreement, a typical Mon Power and Potomac Edison residential customer using 1,000 kilowatt-hours (kWH) of electricity per month would be expected to see their current $95.13 monthly bill drop about 1.5 percent to $93.71 if approved by the PSC.
Commitments from Mon Power and Potomac Edison in the settlement include:
- Increasing their employment levels in West Virginia by an additional 50 employees either employed by Mon Power, Potomac Edison or by an affiliate of the companies
- Economic Stability Credits of about $2.3 million over a two-year period for large commercial and industrial customers to benefit the regional economy
- A $500,000 contribution over five years to the Dollar Energy Fund or similar agency to assist low-income customers with paying their electric bills
- A $500,000 contribution over five years to the West Virginia Office of Economic Opportunity's weatherization program to assist residential customers with weatherizing their homes
- A $500,000 contribution over five years to the Governor's West Virginia Kids First Initiative to support energy efficiency initiatives in public schools
- Development of a Phase II Energy Efficiency Plan to achieve reductions of 0.5 percent of 2013 distribution sales in the delivery year ending May 31, 2018.
The parties have requested that the PSC issue a final order approving the settlement agreement and the transaction no later than August 30, 2013. If approved as requested, the transaction would likely close in the third quarter or early in the fourth quarter. The Federal Energy Regulatory Commission has already reviewed and approved the proposed transaction.
Under the proposed plan, Mon Power will purchase about 80 percent of the Harrison Power Station from FirstEnergy (FE) subsidiary Allegheny Energy Supply, adding to its approximate 20 percent share and giving it sole ownership of the 1,984-megawatt (MW) supercritical coal plant in Haywood, W. Va. The plan would ensure that Mon Power has adequate resources to meet a slow, but steady, annual load growth rate of 1.4 percent. As part of the transaction, Mon Power will transfer its approximate 8 percent interest in the Pleasants Power Station to Allegheny Energy Supply.
The proposed transaction represents a $1.1 billion investment by Mon Power and benefits customers and the West Virginia economy. Harrison produces electricity with locally mined coal, and the transaction would preserve the opportunity to continue to use such coal, sustaining employment levels and helping local economies. Among the nation's largest and cleanest coal-fired plants, Harrison is equipped with modern emission controls.
Mon Power supplies electricity to both its 385,500 customers and 132,000 Potomac Edison customers in the state's Eastern Panhandle.
FirstEnergy is a diversified energy company dedicated to safety, reliability and operational excellence. Its 10 electric distribution companies form one of the nation's largest investor-owned electric systems, serving customers in Ohio, Pennsylvania, New Jersey, West Virginia, Maryland and New York. Its generation subsidiaries control more than 20,000 megawatts of capacity from a diversified mix of scrubbed coal, non-emitting nuclear, natural gas, hydro, pumped-storage hydro and other renewables. Follow FirstEnergy on Twitter @FirstEnergyCorp.
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