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FirstEnergy signs 8-year PPA after Ohio PUC approval

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Essential Energy Insights - February 2021

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Six trends shaping the industries and sectors we cover in 2021

Six trends shaping the industries and sectors we cover in 2021


FirstEnergy signs 8-year PPA after Ohio PUC approval

FirstEnergyCorp. subsidiaries on April 1 inked an following the Public Utilities Commission of Ohio's of the deal with modifications,according to a Form 8-K filed April 5.

Under the deal approved March 31, FirstEnergy utilitysubsidiaries Ohio EdisonCo., ClevelandElectric Illuminating Co., and Toledo Edison Co. will buy the output of the 2,220-MWW.H. Sammis coalplant and 908-MW Davis-Besse nuclear plant from unregulated affiliateFirstEnergy SolutionsCorp. in exchange for monthly payments.

The Ohio utilities will also purchase a 4.85% stake inOhio Valley ElectricCorp.'s KygerCreek and CliftyCreek coal plants and then will sell the output into the market.Customers will receive rate credits or charges to offset power purchase costs.

The agreement will start June 1 and end May 31, 2024. Thecommission modified the proposed deal to limit the average customer billamounts for the first two years of the term and to prohibit recovery ofretirement costs of the facilities through a retail rate stability rider.

The decision also assigns the burden of capacity performancepenalties and bonuses of the facilities to the Ohio companies instead ofcustomers.

The agreement has received strong opposition from groupssaying it is a "handout" amounting to