FirstEnergy Corp.'s Ohio utilities said the Public Utilities Commission of Ohio approved, with certain modifications, Powering Ohio's Progress, their proposed Electric Security 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.
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, preserve key power plants that serve Ohio customers, reinstate energy efficiency programs, evaluate smart grid technologies, and includes a goal to reduce carbon dioxide emissions by at least 90 percent below 2005 levels by 2045. The Commission also added certain additional customer protections.
The plan outlines a new retail rate stability provision related to a proposed eight-year purchased power agreement 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 Corp. (OVEC) units in Gallipolis, Ohio, and Madison, Ind. This 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 Chief Executive Officer. "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'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. Over the eight-year term, the arrangement is projected to generate hundreds of millions in customer savings as retail power prices increase over time.
FirstEnergy's plan also establishes a goal to reduce companywide CO2 emissions by at least 90 percent below 2005 levels by 2045. This is among the most aggressive targets in the utility industry, representing a potential reduction of more than 80 million tons of CO2 emissions. A carbon reduction report will be filed by November 1, 2016 highlighting a strategy to promote fuel diversification and carbon reduction, recognizing that energy efficiency, renewable energy resources, and other advanced resources may be part of the strategy.
FirstEnergy also will contribute more than $102 million over the life of the plan to help low-income customers pay their electric bills, as well as provide energy efficiency and economic development funding for low-income customers and communities.