Round 1 ends, but battle looms for firstenergy – crain’s cleveland business

The Public Utilities Commission of Ohio on March 31 provided Akron-based FirstEnergy with a unanimous decision approving the company’s proposed power purchase agreements.

Because those PPAs include special fees put to ratepayers to guarantee the profitable sale of power from FirstEnergy plants to its distribution arm, interests ranging from local governments to other power companies and environmentalists cried foul. Q mart gas station The deal is anti-competitive and only ensures that dirty coal and outdated nuclear plants remain online longer than any invisible hand would allow, they contend.

But the PUCO sided with FirstEnergy. Gas in spanish It agreed the plants are necessary to Ohio, in part because they represent on-demand backup power that could be needed again if, say, natural gas prices were to spike because fracking were banned. Q card gas station And that settled the matter. Gas under 3 dollars Or not.

FirstEnergy’s 18-month slugfest in front of the PUCO was brutal, and no doubt costly in terms of public relations, advertising and lobbying. I have electricity in my body It also might have just been a warm-up for the real brawl, or brawls, that are to come. Electricity lesson plans 8th grade The next venue is probably national, too, before the Federal Energy Regulatory Commission.

“I think there’s a high probability FirstEnergy will lose when it goes to FERC,” predicts Andrew Thomas, a longtime energy law attorney and an economic researcher on energy matters at Cleveland State University.

FERC has jurisdiction because FirstEnergy sells power from the plants affected by the PPAs into the wholesale market, which is the federal agency’s domain. Astrid y gaston lima menu english Thomas said FERC does not like anti-competitive deals or transactions that are not arm’s length.

Former PUCO chairman Todd Snitchler, who now consults with power generators seeking to sell into the Ohio market, thinks FERC represents the biggest threat to FirstEnergy’s PPAs, especially because competitors are complaining that the PUCO ruling upsets the wholesale power market. Gas lighting FERC must waive some of its rules on affiliate transactions for the PPAs to stand, he said.

“That case is one I think people feel have very strong merits, and there’s a great likelihood of success in that case,” Snitchler said. Static electricity bill nye “That’s the one most industry watchers think has legs.”

Even if FirstEnergy does survive an FERC fight, it probably will come back home for a slugfest with heavyweight lawyers before the Ohio Supreme Court, assuming the PUCO stands by its decision on any appeals, as expected. Gas x dosage for dogs If that happens, lawyers will be throwing jabs about how the PUCO is circumventing the Ohio Legislature’s intention, in violation of the state constitutions, with a few other hooks no doubt thrown in as well.

The PUCO’s March 31 rulings on FirstEnergy and Columbus-based AEP “continue an unwelcome trend of government intervention in competitive markets, at the urging of the state’s electric utilities,” wrote the Office of the Ohio Consumers’ Counsel. Electricity physics formulas “As a result, several million Ohioans will pay a lot more for electricity than the market prices intended by the state Legislature.”

The Consumers’ Counsel continued, “It is difficult to connect the dots between electric deregulation and market prices in the 1999 Ohio law to making consumers pay for re-regulation and subsidized power plants in the decisions today. Electricity online games The Ohio Consumers’ Counsel has asked federal officials who oversee the nation’s electric markets to protect Ohioans from paying subsidies for power plants.”

“FirstEnergy’s Purchased Power Agreement complies with existing Federal Energy Regulatory Commission (FERC) rules that promote customers shopping for retail energy supply,” the company said in a statement.

“With the PPA, customers retain their ability to select a generation supplier, and the PPA has no impact on the price customers pay for generation,” the utility added. Gas engine efficiency “FirstEnergy believes energy costs will increase in the future. Gas vs diesel truck Under the PPA, the company’s Ohio utilities will help safeguard customers from future rate increases by crediting customers’ bills when energy prices rise.”

Meanwhile, environmentalists, other power generators, local governments, green-energy advocates and others are jumping onboard the opposition train, either complaining to FERC or threatening to take the matter to the Ohio Supreme Court or the PJM Interconnection, which sets the rules for the electric grid upon which FirstEnergy relies and seeks a level playing field for all generators who use the grid.

New York based Fitch Ratings issued a release on Monday, April 4, addressing the likelihood that FirstEnergy’s sweet deal will face potentially souring challenges. 66 gas station near me The PPAs, as they now stand, represent a “constructive credit development for them and their Ohio-based utility and power generation subsidies,” Fitch wrote.

Of course, in a release headlined “Fitch: Ohio Affiliate PPAs May Face Further Scrutiny,” the way things currently stand was not the issue the credit rating agency was pointing out.

“However, pending complaints filed with the Federal Energy Regulatory Commission (FERC) earlier this year are a source of uncertainty regarding the viability of the affiliate PPAs,” Fitch continued. Electricity physics test “In addition, Fitch expects parties opposing the PPAs will seek a rehearing and, ultimately, judicial review of the PUCO order.”

In other words: Those PPAs are nice, if you’re a FirstEnergy creditor, but get ready to watch them get assailed in a variety of venues and courts and they could get thrown out.

Even some who have supported FirstEnergy’s argument before the PUCO aren’t optimistic the company’s victory will last. Gas oil ratio for leaf blower But, as in any case before a court or regulatory body, no one is sure of the outcome.

“I think it will more likely than not be shot down,” said Matt Brakey, an energy consultant to businesses and president of Shaker Heights-based Brakey Energy. Electricity 1 unit how many watts “But the odds aren’t much better than a coin flip.”

Snitchler basically agrees but is reluctant to predict an outcome. Static electricity jokes What he is sure of, he said, is that Ohio’s electricity market will face more uncertainty for up to two years as the matter winds its way through courts and regulatory agencies.

That probably helps FirstEnergy, he said, because uncertainty will make it more difficult for competitors to make investment decisions about building new plants in Ohio or that would sell into its electricity markets.