By Editors of Power Engineering
FirstEnergy Corp. has begun a strategic review of its generation business that could result in the sale or closure of 13 power plants, including its three nuclear plants.
The review was revealed during a conference call with analysts, the Akron Beacon Journal reported.
“The fact is, competitive generation is weighing down the rest of the company,” Charles Jones, FirstEnergy’s CEO and president, said during the call. “We do not think competitive generation is a good fit.”
Despite a $380 million profit for the company’s third quarter, FirstEnergy has lost $381 million over the three quarters and will likely end the year with a loss, Jones said.
Additionally, $515 million in debt will come due in 2018.
The 13 power plants eyed for sale include six natural gas, four coal and three nuclear. A partial interest in a hydroelectric plant could also be sold off. If buyers could not be found, some units could face closure.
Additionally, it’s possible FirstEnergy’s competitive generation unit could file for Chapter 11 bankruptcy protection and reorganize.
“We are at a crossroads,” Jones said. “We have to make some tough decisions.”
These options will be implemented over the next 12 to 18 months. The crunch comes as FirstEnergy plans to become a fully-regulated utility once more after operating under Ohio’s 1999 electric deregulation initiative.
FirstEnergy has already announced it will sell or deactivate the 136-MW Bay Shore Unit 1 in Oregon, Ohio, by October 2020.