COLUMBUS — FirstEnergy and the Ohio Attorney General’s office reached an agreement on a clause in House Bill 6 that would have cost customers an extra $102 million this year, the attorney general’s office announced Feb. 1.
The out-of-court settlement ends the decoupling provision – a guaranteed profit rider for First Energy.
“Under its now removed prior leadership, FirstEnergy built a feeding trough that it thought would guarantee it record profits year after year, filled with unearned money out of Ohioan’s pockets” Attorney General Dave Yost said, in a statement. “This agreement recognizes the corrupt influence used to guarantee a for-profit company above-market returns for years to come by operation of law.”
The Public Utilities Commission of Ohio set the decoupling rate to zero Feb. 2 after FirstEnergy filed updated tariffs in response to the agreement with the attorney general’s office.
FirstEnergy’s Ohio utilities, Cleveland Electric Illuminating Company, Ohio Edison and Toledo Edison, will stop including decoupling charges on customer bills starting Feb. 9.
The settlement comes in response to a motion Yost filed in Franklin County Common Pleas Court in January seeking to block FirstEnergy from using a decoupling provision contained in House Bill 6. The provision, as written, allowed FirstEnergy to adjust rates to ensure it made at least $978 million a year going forward. That benchmark came from 2018 when a cold winter and a scorching summer combined to boost FirstEnergy’s revenue to a record $978 million.
The attorney general’s office said this action is projected to save Ohioans nearly $2 billion over the years House Bill 6 would have been effective.
Yost agreed to withdraw the motion, but the rest of the case will remain before the court, pending the end of federal criminal trials.
In December, a Franklin County judge blocked fees that were to be tacked onto Ohio power customers’ bills as part of the House Bill 6 nuclear plant bailout. Federal authorities alleged House Bill 6 became law as part of a bribery scheme involving FirstEnergy and former House Speaker Larry Householder.
In addition to the nuclear bailout and decoupling clause to benefit FirstEnergy, House Bill 6 gutted the state’s renewable energy and energy efficiency standards for utilities and gave out subsidies for coal plants and large utility scale solar farms.
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