READING, Pa., Feb. 16, 2016 /PRNewswire/ -- To help ensure continued service reliability for two million Pennsylvania customers, FirstEnergy Corp. (NYSE: FE) subsidiaries Pennsylvania Power Company (Penn Power), West Penn Power Company (West Penn Power), Metropolitan Edison Company (Met-Ed) and Pennsylvania Electric Company (Penelec) recently received approval from the Pennsylvania Public Utility Commission (PPUC) for Long Term Infrastructure Improvement Plans that will result in a total of an additional $245 million being spent on capital investments over the next five years.
"The improvement plans for each utility are designed to complement the work we already do to reduce the number and duration of outages our customers experience," said Linda Moss, FirstEnergy's president of Pennsylvania Operations. "The plans will help us accelerate the vital work that targets enhancing service reliability."
Planned projects include replacing underground cable, installing new fuses and sectionalizing devices on overhead wires, replacing aging circuit breakers and transformers in substations and replacing additional wooden poles.
Approximately $56 million of the work is expected to be completed in 2016 in the utilities' service areas, with the remainder being spent over the next four years that the plans will be in place.
The costs associated with these service reliability investments will be recovered by the FirstEnergy utilities through Distribution System Improvement Charges (DSICs) that were filed today with the PPUC. For an average FirstEnergy residential customer in Pennsylvania, the DSICs will initially result in about a $0.06 increase in their monthly bill, and will be updated quarterly. The companies have requested that the DSICs take effect July 1, 2016.
The Long Term Infrastructure Improvement Plans and DSICs were authorized by Pennsylvania Act 11, which was approved in 2012, establishing a process to encourage electric, natural gas, water and sewer utilities in Pennsylvania to accelerate investments in aging infrastructure and help create economic benefits.
FirstEnergy's Pennsylvania utilities have, on average, the lowest rates in the state among investor-owned electric distribution companies. If approved, the new rates would still, on average, be lower than the average rates charged today by other Pennsylvania utilities.
The rate impact for each FirstEnergy utility, including the Long Term Infrastructure Improvement Plans and associated DSICs are:
- Penn Power is proposing to spend an additional $56 million during the next five years. If approved, the total bill for an average residential customer using 1,000 kilowatt-hours (kWh) per month would initially increase $0.15, for a new monthly total bill of $139.37.
- West Penn Power is expecting to spend an additional $88 million during the next five years. If approved, the total bill for an average residential customer using 1,000 kWh per month would initially increase $0.03, for a new monthly total bill of $113.37.
- Penelec is planning to spend an additional $57 million during the next five years. If approved, the total bill for an average residential customer using 1,000 kWh a month would initially increase $0.03, for a new monthly bill of $143.03.
- Met-Ed is proposing to spend an additional $43 million during the next five years. If approved, the total bill for an average residential customer using 1,000 kWh per month would initially increase $0.02, for a new monthly bill of $139.68.
Penn Power serves approximately 161,000 customers within 1,100 square miles of western Pennsylvania. West Penn Power serves approximately 720,000 customers within 10,400 square miles of central and southwestern Pennsylvania. Met-Ed serves 560,000 customers within 3,300 square miles of eastern and southeastern Pennsylvania. Penelec serves nearly 600,000 customers within 17,600 square miles of northern and central Pennsylvania.
FirstEnergy is a diversified energy company dedicated to safety, reliability and operational excellence. Its 10 electric distribution companies form one of the nation's largest investor-owned electric systems, serving customers in Ohio, Pennsylvania, New Jersey, West Virginia, Maryland and New York. The company's transmission subsidiaries operate more than 24,000 miles of transmission lines that connect the Midwest and Mid-Atlantic regions. Visit FirstEnergy online at www.firstenergycorp.com and follow on Twitter at @FirstEnergyCorp.
Forward-Looking Statements: This news release includes forward-looking statements based on information currently available to management. Such statements are subject to certain risks and uncertainties. These statements include declarations regarding management's intents, beliefs and current expectations. These statements typically contain, but are not limited to, the terms "anticipate," "potential," "expect," "forecast," "target," "will," "intend," "believe," "project," "estimate," "plan" and similar words. Forward-looking statements involve estimates, assumptions, known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements, which may include the following: the speed and nature of increased competition in the electric utility industry, in general, and the retail sales market in particular; the ability to experience growth in the Regulated Distribution and Regulated Transmission segments and to successfully implement our revised sales strategy for the Competitive Energy Services segment; the accomplishment of our regulatory and operational goals in connection with our transmission investment plan, including but not limited to, our pending transmission rate case, the proposed transmission asset transfer, and the effectiveness of our repositioning strategy to reflect a more regulated business profile; changes in assumptions regarding economic conditions within our territories, assessment of the reliability of our transmission system, or the availability of capital or other resources supporting identified transmission investment opportunities; the impact of the regulatory process on the pending matters at the federal level and in the various states in which we do business including, but not limited to, matters related to rates and the Electric Security Plan IV in Ohio; the impact of the federal regulatory process on the Federal Energy Regulatory Commission (FERC)-regulated entities and transactions, in particular FERC regulation of wholesale energy and capacity markets, including PJM Interconnection, L.L.C. (PJM) markets and FERC-jurisdictional wholesale transactions; FERC regulation of cost-of-service rates, including FERC Opinion No. 531's revised Return on Equity methodology for FERC-jurisdictional wholesale generation and transmission utility service; and FERC's compliance and enforcement activity, including compliance and enforcement activity related to North American Electric Reliability Corporation's mandatory reliability standards; the uncertainties of various cost recovery and cost allocation issues resulting from American Transmission Systems, Incorporated's realignment into PJM; economic or weather conditions affecting future sales and margins such as a polar vortex or other significant weather events, and all associated regulatory events or actions; changing energy, capacity and commodity market prices including, but not limited to, coal, natural gas and oil, and their availability and impact on margins and asset valuations; the continued ability of our regulated utilities to recover their costs; costs being higher than anticipated and the success of our policies to control costs and to mitigate low energy, capacity and market prices; other legislative and regulatory changes, and revised environmental requirements, including, but not limited to, the effects of the United States Environmental Protection Agency's Clean Power Plan, coal combustion residuals regulations, Cross-State Air Pollution Rule and Mercury and Air Toxics Standards programs, including our estimated costs of compliance, Clean Water Act waste water effluent limitations for power plants, and Clean Water Act 316(b) water intake regulation; the uncertainty of the timing and amounts of the capital expenditures that may arise in connection with any litigation, including New Source Review litigation, or potential regulatory initiatives or rulemakings (including that such initiatives or rulemakings could result in our decision to deactivate or idle certain generating units); the uncertainties associated with the deactivation of certain older regulated and competitive fossil units, including the impact on vendor commitments, and as they relate to the reliability of the transmission grid, the timing thereof; the impact of other future changes to the operational status or availability of our generating units and any capacity performance charges associated with unit unavailability; adverse regulatory or legal decisions and outcomes with respect to our nuclear operations (including, but not limited to the revocation or non-renewal of necessary licenses, approvals or operating permits by the Nuclear Regulatory Commission or as a result of the incident at Japan's Fukushima Daiichi Nuclear Plant); issues arising from the indications of cracking in the shield building at Davis-Besse; the risks and uncertainties associated with litigation, arbitration, mediation and like proceedings, including, but not limited to, any such proceedings related to vendor commitments; the impact of labor disruptions by our unionized workforce; replacement power costs being higher than anticipated or not fully hedged; the ability to comply with applicable state and federal reliability standards and energy efficiency and peak demand reduction mandates; changes in customers' demand for power, including, but not limited to, changes resulting from the implementation of state and federal energy efficiency and peak demand reduction mandates; the ability to accomplish or realize anticipated benefits from strategic and financial goals, including, but not limited to, the ability to continue to reduce costs and to successfully execute our financial plans designed to improve our credit metrics and strengthen our balance sheet through, among other actions, our previously-implemented dividend reduction, our cash flow improvement plan and our other proposed capital raising initiatives; our ability to improve electric commodity margins and the impact of, among other factors, the increased cost of fuel and fuel transportation on such margins; changing market conditions that could affect the measurement of certain liabilities and the value of assets held in our Nuclear Decommissioning Trusts, pension trusts and other trust funds, and cause us and/or our subsidiaries to make additional contributions sooner, or in amounts that are larger than currently anticipated; the impact of changes to material accounting policies; the ability to access the public securities and other capital and credit markets in accordance with our financial plans, the cost of such capital and overall condition of the capital and credit markets affecting us and our subsidiaries; actions that may be taken by credit rating agencies that could negatively affect us and/or our subsidiaries' access to financing, increase the costs thereof, and increase requirements to post additional collateral to support outstanding commodity positions, letters of credit and other financial guarantees; changes in national and regional economic conditions affecting us, our subsidiaries and/or our major industrial and commercial customers, and other counterparties with which we do business, including fuel suppliers; the impact of any changes in tax laws or regulations or adverse tax audit results or rulings; issues concerning the stability of domestic and foreign financial institutions and counterparties with which we do business; the risks associated with cyber-attacks on our electronic data centers that could compromise the information stored on our networks, including proprietary information and customer data; and the risks and other factors discussed from time to time in our United States Securities and Exchange Commission filings, and other similar factors. The foregoing review of factors should not be construed as exhaustive. New factors emerge from time to time, and it is not possible for management to predict all such factors, nor assess the impact of any such factor on FirstEnergy's business or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statements. FirstEnergy expressly disclaims any current intention to update, except as required by law, any forward-looking statements contained herein as a result of new information, future events or otherwise.
SOURCE FirstEnergy Corp.