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NOPEC Requests Rejection of PUCO Staff's 'Rubber Stamp' Approval of FirstEnergy Affiliate Deal

By NOPEC on  April 15, 2020

SOLON, OH - The Northeast Ohio Public Energy Council (NOPEC) called on the Public Utilities Commission of Ohio (PUCO) to reject its staff’s recommendation that FirstEnergy Advisors be approved to be a statewide energy broker and aggregator. (Link to complete filing here)

Additionally, NOPEC and the Ohio Consumers’ Counsel (OCC) in separate requests asked the PUCO to release public records of any communications with FirstEnergy Advisors. (Link to complete filing here)

NOPEC, Ohio’s largest nonprofit energy aggregator, and the OCC, along with six other statewide energy companies and organizations that promote or provide competitive electric services, have filed in the case to oppose or express serious concern about FirstEnergy Advisors’ application.

FirstEnergy Advisors is a new subsidiary set up by investor-owned utility giant FirstEnergy Corp.  Its offices are in the same building as the FirstEnergy utility headquarters in Akron.  Opponents view this application as a conflict of interest.

NOPEC, in one filing with the PUCO, called the application both unlawful and “unprecedented…because its [FirstEnergy Advisors’] provision of competitive electric services will be managed and controlled by the same senior executive management team that controls the provision of non-competitive electric distribution services.”  In the latest filing, NOPEC called the FirstEnergy Advisors’ management and control structure “a textbook classic example of market power abuse.”

In other words, while FirstEnergy Advisors (FEA) says it would work with electric customers to get them the best deal by fielding competitive bids from various suppliers, the opportunity and temptation to take advantage of the parent company’s electric distribution utility subsidiaries’ network, and use of the FirstEnergy name in a competitive setting, represents too great a threat to consumers and Ohio’s competitive retail electric market.  And FirstEnergy, with its massive marketing reach, could squash competition in several ways, including referring its utility customers to FirstEnergy Advisors. FirstEnergy also could benefit from referring FEA customers to its former generation subsidiary, Energy Harbor (formerly known as FirstEnergy Solutions).

“In the long run, what we know in Ohio is when there is no competition, prices go up,” said Chuck Keiper, NOPEC Executive Director.  “We’ll be moving back to a toxic environment where the utilities control the marketplace.”

According to jointly published Ohio State University/Cleveland State University studies in 2016 and 2019, electric deregulation in the state – allowing consumers to choose their electricity supplier - has saved Ohio consumers nearly $24 billion since 2011. 

Despite pages of filings from all of the opponents outlining why the proposed application is illegal and anti-competitive, and requests for a hearing, the PUCO staff recently sent the Commissioners a two-paragraph “review” and recommendation that FirstEnergy Advisors’ certificate is approved by the commission without a hearing or opportunity for public input.

“NOPEC expected more from Staff than a rubber stamp approval of a highly controversial application without requiring a hearing or comment procedure to allow public input into this key case affecting Ohio’s deregulated electric market,” NOPEC said in its filing with the PUCO responding to the staff recommendation.

The PUCO should reject the staff recommendation and either deny FirstEnergy Advisors’ application or order a hearing that would bring the matter into the public light, NOPEC said.

That staff approval recommendation also came despite FirstEnergy Advisors’ refusal to respond to any discovery requests for information about the application made by NOPEC, the OCC and other opponents.

“It comes down to a simple question: What are they hiding?” Keiper said. “In fact, FirstEnergy Advisors is so intent on hiding its relationship with FirstEnergy Corp.’s Ohio electric distribution utilities that it asked the PUCO to order a blanket ban on all discovery as a condition of the application proceeding.”

Further, Keiper said, the staff report “lacks transparency, due process and the type of detailed review that is called for in this contested proceeding with 8 other intervenors agreeing the application should not be approved.”

The concern that electricity consumers across much of the state could be hurt by a deal made behind closed doors without a hearing or an opportunity for the intervenors or the public to participate prompted the public records request, Keiper said.

“We’ve been about competition since we began in 2001,” Keiper said.  “We’re not afraid of another electricity broker coming into the market. In fact, we welcome it! But bring it on in a fair, honest, legal and transparent way. Let everyone see communications, if any, between FirstEnergy Advisors and the public body PUCO. Taxpayers and electricity consumers in Ohio are owed that, and a fully public process to investigate this application.”

 

About NOPEC

NOPEC (Northeast Ohio Public Energy Council) is a nonprofit group of over 235 communities in 19 Ohio counties that negotiates lower utility rates for its members.  As Ohio’s largest governmental retail energy aggregator, NOPEC buys gas and electricity in bulk to help lower customers’ utility bills.  Since 2001, NOPEC has saved residents and businesses hundreds of millions of dollars on their energy costs and awarded more than $28 million in energy-efficiency grants to NOPEC member communities.  For more information about NOPEC, visit www.nopec.org.

Tags: NOPEC, PUCO, FirstEnergy
Categories: Newsroom

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