FirstEnergy couldn’t have possibly imposed fees associated with its lobbying for Ohio House Bill 6 on ratepayers because rates for those customers were set in 2008, the company argued in response to a Public Utilities Commission of Ohio probe this week.
Rates were set and frozen through May 31, 2024 based on a test year ending in February 2008, the company said.
“This test year clearly predated any of the H.B. 6 costs,” the company wrote in its statement. “Because the test year predated any H.B. 6 costs, those costs cannot possibly be included in the Companies’ base rates.”
The Public Utilities Commission of Ohio (PUCO) launched a review of Ohio’s largest utility company in mid-September after former House Speaker Larry Householder was indicted on racketeering charges in late July.
A criminal complaint filed against Householder in July alleges an unnamed company — referred to as “Company A” but understood to be FirstEnergy and its affiliates — funded the campaigns of nearly 20 house races to elect representatives who would support Householder’s bid for house speaker.
In return, Householder allegedly helped push House Bill 6 through the Ohio legislature. The bill, which helps bail out two plants owned by a former FirstEnergy subsidiary Energy Harbor, will impose a $0.85 cent increase on all ratepayers starting in January if it isn’t repealed soon.
Advocate groups say PUCO’s probe doesn’t go far enough, calling on the commission to audit FirstEnergy’s finances and require executives to submit documents under oath, among other actions. The state’s residential utility consumer advocate, the Ohio Consumers Council (OCC), filed a 135-page interlocutory appeal in the case Sept. 21, claiming PUCO’s proposed review is inadequate and could “thwart consumer protection.”
The filing calls on PUCO attorney examiner Greg Price to amend the original filing to incorporate a number of additional oversight measures like hiring an independent auditor to inspect the company’s finances and the requirement that FirstEnergy executives make their filings under oath.
The OCC filed a request in early September asking that PUCO independently audit FirstEnergy and its affiliates. The PUCO review that launched soon after didn’t include an audit, but commission spokesman Matt Schilling said that could potentially come later, depending on what type of evidence was produced in response to the Show Cause order.
PUCO’s review doesn’t require FirstEnergy to show that it did not violate any utility regulatory laws, rules or orders in its activities regarding House Bill 6, the OCC wrote in its appeal. Nor did it order the FE utilities, FE Corp., FE affiliates, and Energy Harbor to retain and not destroy all records related to House Bill 6.
A number of other advocacy groups, such as the Environmental Law & Policy Center, the Ohio Environmental Council, Ohio Partners for Affordable Energy and the Natural Resources Defense Council have filed motions to intervene in the PUCO case.
Meanwhile, Ohio Attorney General Dave Yost wrote a letter last Friday asking Ohio lawmakers to have Energy Harbor and FirstEnergy Corp. representatives testify about whether the two nuclear power plants slated to receive the $1.3 billion bailout actually need the money, Cleveland.com reported this week.
“It is true Ohio is seeking a restraining order to prevent the various Defendants, including Energy Harbor, from lobbying the General Assembly,” Yost wrote. “This requested order is designed to prevent the kind of behind-closed-doors discussions that contributed to the current morass.”
FirstEnergy is also under investigation by the Securities and Exchange Commission, according to documents filed by the company in a lawsuit it brought a whistleblower employee. Michael Pircio, a finance consulting contractor, was fired the same day Householder was indicted. According to the suit, after his termination, he downloaded some 60 files worth of sensitive information from the company’s computers.
His lawyer confirmed in filings that the downloaded documents had been provided to the SEC.
Whether the rates are imposed on Ohioans remains to be seen. It depends on whether the state’s legislative assembly successfully passes a bill rescinding HB6. At least two proposals have been introduced so far.
PUCO spokesman declined to comment on the filing Friday morning, but pointed to the case docket in which FirstEnergy references in its filing the distribution rate case, which was approved by the Commission in 2009.
