Sunday June 19, 2016

Summer is officially here, but school’s not out for FirstEnergy.

After the Federal Energy Regulatory Commission (FERC) shot down the utility’s power plant bailout in Ohio, FirstEnergy revamped its original proposal to skirt that pesky federal oversight. And that’s not just our take on the situation. The company’s CEO said the idea was to achieve the same outcome (refresher: making customers pay billions of dollars to keep open uneconomic power plants), but “without the need for…FERC approval.”

Fortunately for Ohioans, FirstEnergy’s not the only one foregoing the beach. Last Friday, Environmental Defense Fund joined the Electric Power Supply Association’s (EPSA) and others to request FERC overturn the utility’s proposal. Again.

When FERC sees FirstEnergy’s flagrant attempt to defy its prior ruling, and recognizes how the “new” deal is still illegal, then we can take a vacation.

You can always visit EDF’s FirstEnergy website for our newsletter archive and links to the latest news about FirstEnergy’s bailout.

Lower Prices in PJM Market Good for Almost Everyone

An uninformed outsider (not you) may have wondered, “Why does FERC even have a say on FirstEnergy’s plan? Didn’t state regulators already approve it?”

Why, yes – despite vigorous opposition from consumer, environmental, and business advocates – they did. But FirstEnergy is part of a regional wholesale market run by PJM Interconnection, operator of the largest electric grid in the country. PJM is under FERC’s jurisdiction. So, what happens in Ohio does not stay in Ohio.

Every year, PJM identifies the most economic (plain speak: cheapest) power plants to meet the electricity needs of the region for the upcoming years. 2016’s auction took place last month and the topline takeaway is, low natural gas costs and energy efficiency are saving money – a lot of money.

This is music to most people’s ears. It means less energy wasted, less carbon pollution, and more dollars in PJM customers’ pockets.

Who’s not hearing the symphony: Companies that own expensive, outdated, and inefficient power plants. Not that we know any of those.

Fate of Ohio Energy in Hands of New PUCO Chief

There’s a new head sheriff in town. After the former chairman of the Public Utilities Commission of Ohio (PUCO) got the hell out of Dodge, PUCO commissioner Asim Haque was sworn in late last month.

What does this mean for FirstEnergy’s bailout? TBD.

Haque endorsed FirstEnergy’s proposal the first time around, arguing uneconomic power plants were needed to ensure the lights stay on – even though the regional grid operator (aka PJM) declared the dirty plants could close and reliability would be fine. In fact, PJM said providing subsidies to FirstEnergy would discourage others from investing in the electric grid.
Since FirstEnergy’s new request doesn’t guarantee the plants will remain open, the PUCO can no longer try to hide behind the excuse of reliability. 

We also know in a recent discussion on Ohio’s clean energy future, Haque mentioned FirstEnergy’s “commitment” to a 90 percent reduction in CO2 emissions by 2045.

Don’t get us wrong – that would be a wonderful commitment, indeed. But the deal actually included a “goal” to reduce emissions. Like those goals we all make and bore our coworkers with come January 1st. In other words, the utility is making no enforceable promises, and not a darn thing would happen if it misses that target.

Haque has the distinct opportunity to shape Ohio’s energy future. It could be a state where clean energy flourishes, creating jobs while cleaning the air and lowering customers’ bills. Or Ohio could cling to the uneconomic, polluting ways of the past and continue to reward the powerful status quo.

Two roads diverged in a state utility regulatory wood – so which will he take?

"Before we can move on […] we need to get [the AEP and FirstEnergy] cases done and put them in the rearview mirror," Haque noted. Let’s hope the PUCO doesn’t reveal itself to be rubber-stamp regulators – now’s the chance to declare bailouts are bad for Ohio’s customers, economy, and environment.

Quote of the Week

Over the course of this saga in Ohio, many different voices have come out against FirstEnergy’s attempts to prop up its aging fleet. Other energy providers represent a major player in the game, and for obvious reason. If FirstEnergy’s subsidies get approved, they block competition and give the utility a leg up in the market.

That’s why independent power producer Talen Energy “remains steadfast in its opposition,” according to a recent SNL Energy article.

Talen’s CEO Paul Farr assessed the updated bailout ask, in which FirstEnergy employed some creative wording (the utility swapped “subsidy” for “surcharges” and hoped no one would notice).

His reaction is our quote of the week:

• “The substance at the end of the day and the result is the same — uneconomic generation is subsidized.”

What does FirstEnergy have to do with Father’s Day?

Nothing. Just wanted to say Happy Father’s Day to all the dads out there!