FAIRMONT, W.Va., March 7, 2017 /PRNewswire/ -- FirstEnergy
Corp. (NYSE: FE) subsidiaries Mon Power and Potomac Edison today
filed a plan seeking regulatory approval to acquire the Pleasants
Power Station (Pleasants) in
Willow Island, W.Va., as the
least-cost source to meet a steadily increasing capacity shortfall
in the companies' West Virginia
service areas.
If the purchase of Pleasants is
approved by the Public Service Commission of West Virginia (WV PSC) and the Federal Energy
Regulatory Commission (FERC), monthly bills for typical Mon Power
and Potomac Edison West Virginia residential customers using 1,000
kilowatt-hours (kWh) of electricity per month would drop about
$1 per month, or $12 per year.
The proposed Pleasants purchase
also will help preserve coal-related jobs and provide other
economic benefits. The plant employs about 200 people,
consumes more than 3.4 million tons of coal per year and pays
millions of dollars in annual property taxes.
The latest energy forecasts showed a capacity shortfall is
expected to exceed 1,400 megawatts (MW) by 2027 for Mon Power,
which also provides capacity and electricity for Potomac Edison
customers in the state's Eastern Panhandle. Capacity is the
commitment of generation or other resources to be available to
provide electricity, particularly when demand surges during extreme
cold snaps or heat waves.
To address future capacity needs, a competitive request for
proposals (RFP) process was implemented using a nationally
recognized, independent consultant. After evaluating the
proposals, the consultant recommended to Mon Power the purchase of
Pleasants as the most economical
option. At a cost of $195
million, the proposed acquisition of Pleasants from FirstEnergy affiliate Allegheny
Energy Supply is significantly less expensive than any other
bid.
"The purchase of the Pleasants
plant is a win-win-win for our West
Virginia customers by securing a local, reliable source of
electricity to meet future needs, while lowering rates and
continuing significant economic benefits for Pleasants County and surrounding areas," said
Holly Kauffman, president of
FirstEnergy's West Virginia
operations. "The Pleasants
option is expected to save customers money, preserve vital jobs in
the coal industry and provide millions of dollars paid in taxes to
support local services and schools."
The Pleasants plant capacity is
about 1,300 MW. The RFP also requested up to 100 MWs of
demand-response resources, but no such proposals were received.
Mon Power supplies electricity to both its 385,500 customers and
137,000 Potomac Edison customers in the state's Eastern
Panhandle.
FirstEnergy Corp. is 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. The
company's transmission subsidiaries operate more than 24,000 miles
of transmission lines that connect the Midwest and Mid-Atlantic
regions, while its generation subsidiaries control nearly 17,000
megawatts of capacity from a diversified mix of scrubbed coal,
non-emitting nuclear, natural gas, hydro and other
renewables. Follow FirstEnergy on Twitter @FirstEnergyCorp or
online at www.firstenergycorp.com.
Forward-Looking Statements: This news release includes
forward-looking statements based on information currently available
to management. Such statements are subject to certain risks and
uncertainties. These statements include declarations regarding
management's intents, beliefs and current expectations. These
statements typically contain, but are not limited to, the terms
"anticipate," "potential," "expect," "forecast," "target," "will,"
"intend," "believe," "project," "estimate," "plan" and similar
words. Forward-looking statements involve estimates, assumptions,
known and unknown risks, uncertainties and other factors that may
cause actual results, performance or achievements to be materially
different from any future results, performance or achievements
expressed or implied by such forward-looking statements, which may
include the following: the ability to experience growth in the
Regulated Distribution and Regulated Transmission segments; the
accomplishment of our regulatory and operational goals in
connection with our transmission investment plan, including, but
not limited to, our planned forward-looking formula rates and the
effectiveness of our strategy to reflect a more regulated business
profile; changes in assumptions regarding economic conditions
within our territories, assessment of the reliability of our
transmission system, or the availability of capital or other
resources supporting identified transmission investment
opportunities; the ability to accomplish or realize anticipated
benefits from strategic and financial goals, including, but not
limited to, the ability to continue to reduce costs and to
successfully execute our financial plans designed to improve our
credit metrics and strengthen our balance sheet through, among
other actions, our cash flow improvement plan and other proposed
capital raising initiatives; the risks and uncertainties associated
with the lack of viable alternative strategies regarding the
Competitive Energy Services (CES) segment, thereby causing
FirstEnergy Solutions Corp. (FES), and possibly FirstEnergy Nuclear
Operating Company (FENOC), to restructure its debt and other
financial obligations with its creditors or seek protection under
United States bankruptcy laws and
the losses, liabilities and claims arising from such bankruptcy
proceeding, including any obligations at FirstEnergy; the risks and
uncertainties at the CES segment, including FES and its
subsidiaries and FENOC, related to continued depressed wholesale
energy and capacity markets, and the viability and/or success of
strategic business alternatives, such as potential CES generating
unit asset sales, the potential conversion of the remaining
generation fleet from competitive operations to a regulated or
regulated-like construct or the potential need to deactivate
additional generating units; the substantial uncertainty as to FES'
ability to continue as a going concern and substantial risk that it
may be necessary for FES, and possibly FENOC, to seek protection
under United States bankruptcy
laws; the risks and uncertainties associated with litigation,
arbitration, mediation and like proceedings, including, but not
limited to, any such proceedings related to vendor commitments,
such as long-term fuel and transportation agreements; the
uncertainties associated with the deactivation of older regulated
and competitive units, including the impact on vendor commitments,
such as long-term fuel and transportation agreements, and as it
relates to the reliability of the transmission grid, the timing
thereof; the impact of other future changes to the operational
status or availability of our generating units and any capacity
performance charges associated with unit unavailability; changing
energy, capacity and commodity market prices including, but not
limited to, coal, natural gas and oil prices, and their
availability and impact on margins; costs being higher than
anticipated and the success of our policies to control costs and to
mitigate low energy, capacity and market prices; replacement power
costs being higher than anticipated or not fully hedged; our
ability to improve electric commodity margins and the impact of,
among other factors, the increased cost of fuel and fuel
transportation on such margins; the speed and nature of increased
competition in the electric utility industry, in general, and the
retail sales market in particular; the uncertainty of the timing
and amounts of the capital expenditures that may arise in
connection with any litigation, including New Source Review
litigation, or potential regulatory initiatives or rulemakings
(including that such initiatives or rulemakings could result in our
decision to deactivate or idle certain generating units); changes
in customers' demand for power, including, but not limited to,
changes resulting from the implementation of state and federal
energy efficiency and peak demand reduction mandates; economic or
weather conditions affecting future sales and margins such as a
polar vortex or other significant weather events, and all
associated regulatory events or actions; changes in national and
regional economic conditions affecting us, our subsidiaries and/or
our major industrial and commercial customers, and other
counterparties with which we do business, including fuel suppliers;
the impact of labor disruptions by our unionized workforce; the
risks associated with cyber-attacks and other disruptions to our
information technology system that may compromise our generation,
transmission and/or distribution services and data security
breaches of sensitive data, intellectual property and proprietary
or personally identifiable information regarding our business,
employees, shareholders, customers, suppliers, business partners
and other individuals in our data centers and on our networks; the
impact of the regulatory process and resulting outcomes on the
matters at the federal level and in the various states in which we
do business including, but not limited to, matters related to rates
and the Ohio Distribution Modernization Rider; the impact of the
federal regulatory process on Federal Energy Regulatory Commission
(FERC) regulated entities and transactions, in particular FERC
regulation of wholesale energy and capacity markets, including PJM
Interconnection, L.L.C. (PJM) markets and FERC-jurisdictional
wholesale transactions; FERC regulation of cost-of-service rates;
and FERC's compliance and enforcement activity, including
compliance and enforcement activity related to North American
Electric Reliability Corporation's mandatory reliability standards;
the uncertainties of various cost recovery and cost allocation
issues resulting from American Transmission Systems, Incorporated's
realignment into PJM; the ability to comply with applicable state
and federal reliability standards and energy efficiency and peak
demand reduction mandates; other legislative and regulatory
changes, and revised environmental requirements, including, but not
limited to, the effects of the United States Environmental
Protection Agency's Clean Power Plan, Coal Combustion Residuals
regulations, Cross-State Air Pollution Rule and Mercury and Air
Toxics Standards programs, including our estimated costs of
compliance, Clean Water Act (CWA) waste water effluent limitations
for power plants, and CWA 316(b) water intake regulation; adverse
regulatory or legal decisions and outcomes with respect to our
nuclear operations (including, but not limited to, the revocation
or non-renewal of necessary licenses, approvals or operating
permits by the Nuclear Regulatory Commission or as a result of the
incident at Japan's Fukushima
Daiichi Nuclear Plant); issues arising from the indications of
cracking in the shield building at Davis-Besse; changing market
conditions that could affect the measurement of certain liabilities
and the value of assets held in our Nuclear Decommissioning Trusts,
pension trusts and other trust funds, and cause us and/or our
subsidiaries to make additional contributions sooner, or in amounts
that are larger than currently anticipated; the impact of changes
to significant accounting policies; the impact of any changes in
tax laws or regulations or adverse tax audit results or rulings;
the ability to access the public securities and other capital and
credit markets in accordance with our financial plans, the cost of
such capital and overall condition of the capital and credit
markets affecting us and our subsidiaries; further actions that may
be taken by credit rating agencies that could negatively affect us
and/or our subsidiaries' access to financing, increase the costs
thereof, increase requirements to post additional collateral to
support, or accelerate payments under outstanding commodity
positions, letters of credit and other financial guarantees, and
the impact of these events on the financial condition and liquidity
of FirstEnergy and/or its subsidiaries, specifically the
subsidiaries within the CES segment; issues concerning the
stability of domestic and foreign financial institutions and
counterparties with which we do business; and the risks and other
factors discussed from time to time in our United States Securities
and Exchange Commission (SEC) filings, and other similar factors. A
security rating is not a recommendation to buy or hold securities
and is subject to revision or withdrawal at any time by the
assigning rating agency. Each rating should be evaluated
independently of any other rating. The foregoing factors should not
be construed as exhaustive and should be read in conjunction with
the other cautionary statements and risks that are included in our
filings with the SEC, including but not limited to the most recent
Annual Report on Form 10-K and any subsequent Quarterly Reports on
Form 10-Q. The foregoing review of factors also should not be
construed as exhaustive. New factors emerge from time to time, and
it is not possible for management to predict all such factors, nor
assess the impact of any such factor on FirstEnergy Corp.'s
business or the extent to which any factor, or combination of
factors, may cause results to differ materially from those
contained in any forward-looking statements. The registrants
expressly disclaim any current intention to update, except as
required.
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SOURCE FirstEnergy Corp.