Regulatory cases determine the financial obligations of FirstEnergy's Ohio utilities
In a series of ongoing cases at the Public Utilities Commission of Ohio (PUCO), FirstEnergy, a corporation owning three regulated utilities in the state, is embroiled in an alleged multimillion-dollar conspiracy using dark money for bribes.
The centre of the controversy is House Bill 6, a legislation passed in 2019, which mandated more than $1.5 billion in subsidies for aging, uneconomical coal and nuclear power plants, paid for by utility customers. The bill would have charged utility customers over $1 billion over six years for two nuclear plants run by FirstEnergy's unregulated subsidiaries, including FirstEnergy Solutions.
FirstEnergy has admitted to funneling roughly $60 million to dark money groups connected to former Ohio House Speaker Larry Householder (R) and paying $4.3 million to Sam Randazzo, former chair of the PUCO, for helping to pass HB 6 and doing other favors for the company.
One case investigates whether FirstEnergy violated Ohio law requiring corporate separation between utilities and unregulated affiliates. The corporation is accused of improper sharing of resources, conflicts of interest, or lack of adequate separation in management and operations between the regulated utility and its unregulated affiliates.
Another case examines the use of more than $450 million collected from customers under an unlawful bill rider by FirstEnergy. The utilities argue that they shouldn't have to pay much more than a $6.6 million refund, with interest, for the unlawful bill rider.
The Ohio Manufacturers' Association Energy Group and the Office of the Ohio Consumers' Counsel have called for FirstEnergy's Ohio utilities to pay more than half a billion dollars for regulatory violations.
FirstEnergy's utilities claim that the revenue guarantees from HB 6 and nuclear subsidies would have provided them with more baseload power. However, their arguments have been met with criticism, with one watchdog group describing FirstEnergy's proposed resolution as "more like a pat on the back than a slap on the wrist."
The PUCO's fourth HB 6 case, yet to have an evidentiary hearing, investigates whether customer money was used for political or charitable purposes. Additionally, another case considers whether charges to an account meant for utilities' capital equipment expenses were improper.
Lawmakers repealed the charge in 2021, but terms guaranteeing revenue for utilities and gutting Ohio's renewable energy and energy-efficiency standards remain in place. The Ohio Utility Watch newsletter tracks developments in Ohio's ongoing public-corruption saga, known as the House Bill 6 scandal.
FirstEnergy's spokesperson Jennifer Young has stated that the company is unable to comment on ongoing litigation. The corporation maintains that its actions were intended to benefit its regulated utilities.
The evidence against FirstEnergy is clear: the corporation is accused of committing violations against Ohio laws regarding the separation of utilities and unregulated subsidiaries, bribing former Ohio House Speaker Larry Householder, and misusing customer funds. As the cases unfold, the public will be watching closely to see how this scandal will shape the future of energy policy in Ohio.
