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Timing Games
Electric utilities seeking bailouts have a habit of imposing arbitrary deadlines on legislators, threatening to close their plants if they don’t get their subsidies. FirstEnergy Solutions is pushing for a June 2019 subsidy decision, which coincidently matches the end of Ohio’s legislative session.
Yet in March 2017, the utility giant claimed the nuclear plants are “in danger of premature closing by the summer of 2018 unless a buyer emerges or the utility gets help from legislators in Ohio and Pennsylvania.” In May 2017, the Davis-Besse and Perry reactors cleared the PJM Capacity Auction, which required them to be available to run from June 2020 to May 2021 or incur major capacity performance penalties. Another change of tune came in March 2018, when FirstEnergy asked the federal government for subsidies beginning within 16 days, saying its nuclear and coal plants were “at imminent risk of permanent closure if something is not done now.”
FirstEnergy’s arbitrary deadlines have little to do with reality, and more to do with the next billion dollar bailout on its wish list. Fortunately, the president of the Ohio Senate, Sen. Larry Obhof, recognizes FirstEnergy’s timing games: “I don’t think anybody sets the legislative schedule except for me and the chairmen and the members.”
Changing Bailout Pleas
FirstEnergy Solutions recently testified that the minimal level of annual support needed for its uneconomic reactors is $150 million a year. However, in August 2014, FirstEnergy told Ohio regulators that its plants would be profitable and provide customers with a $107 million credit in 2019. In February 2016, it predicted its subsidy pleas would give customers $561 million in credits over the next eight years. Only five months later, FirstEnergy requested a direct subsidy of at least $558 million per year for the next eight years.
Is it unreasonable to ask the bailout pleader to be a bit more consistent?
Scam
Now, for your weekly dose of irony: FirstEnergy has been warning consumers of scammers. “Utility customers have been targeted by criminals through schemes that include door-to-door visits, phone calls and electronic communications. For your safety and security, we urge all customers to remain vigilant against scammers who claim to be associated with our company.”
We agree FirstEnergy customers should remain vigilant. But we suggest they also beware of schemes that include “asking customers to pay billions of dollars to make up for FirstEnergy’s bad business decisions.”
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