FirstEnergy Corp’s subsidiaries – Met-Ed, Penelec, Penn Power, West Penn Power, Keystone Appalachian Transmission Company (KATCo) and Mid-Atlantic Interstate Transmission, LLC – have filed a settlement agreement with the Pennsylvania Public Utility Commission (PaPUC) regarding their joint application to merge FirstEnergy’s four Pennsylvania electric distribution companies into a single consolidated operating company.
Under the terms of the proposed settlement, income-eligible customers would receive a total of $650,000 in bill assistance over five years. In addition, the settlement outlines a mechanism for tracking cost savings realized through consolidated operations, which would be returned to customers as part of future base rate reviews.
The settlement, if approved by the PaPUC, would help enable the path forward for the companies’ March 2023 application filed with the PaPUC that would consolidate the subsidiaries into a single legal entity called FirstEnergy Pennsylvania Electric Company (FE PA). The distribution companies will continue to do business publicly under the existing local brand names that are familiar to customers – Met-Ed, Penelec, Penn Power, and West Penn Power.
The companies have requested PaPUC approval of their application no later than December 2023 and are also awaiting commission approval in New York. In a related proceeding, the Federal Energy Regulatory Commission approved the companies’ consolidation application on August 14, 2023.
Following consolidation, customers would continue to receive service from the electric company brands that currently deliver their electricity. For billing and other customer-facing purposes, the four electric companies would continue to use their existing names. Similarly, customer rates and terms and conditions of service would not change as a result of the consolidation, the companies said. Consolidation also would not change Universal Service Programs, Pennsylvania Customer Assistance Programs for lower-income customers, Energy Efficiency programs, and Default Service programs. Any changes to customer rates, terms and conditions, and programs will be addressed in future base rate reviews and other proceedings.
By consolidating to a larger, combined company, FE PA says it anticipates gaining greater access to capital at more favorable interest rates to invest in projects to improve customer service and further enhance the energy grid.
If approved, the consolidation would also result in the transfer of transmission assets owned and operated by West Penn Power to KATCo. As a distribution-only company, FE PA would focus its investments solely on serving its local customers.
Parties to the settlement include, but are not limited to, the Office of Consumer Advocate, the Office of Small Business Advocate, Pennsylvania State University, the Bureau of Investigation and Enforcement, the Coalition for Affordable Utility Services and Energy Efficiency in Pennsylvania, Industrial Consumer Groups and Industrial Energy Consumers of Pennsylvania.
