January 22, 2018 Read More →

FERC Denies Pleasants Power Station Transfer

Charleston Gazette-Mail:

The Federal Energy Regulatory Commission has denied Mon Power and Potomac Edison’s request to buy a Pleasants County power plant from parent company FirstEnergy, according to a filing Friday.

FirstEnergy planned to sell Pleasants Power Station, a coal-fired plant, to its subsidiaries for $195 million. If the deal went through, it would have become part of the regulated West Virginia market, where it is guaranteed a profit.

Consumer advocacy groups had criticized the proposed deal for mirroring Mon Power’s purchase of the Harrison power plant in Haywood, Harrison County. That deal cost ratepayers more than $160 million in its first three years, according to a report from the Institute for Energy Economics and Financial Analysis.

The state Consumer Advocate Division had submitted a protest asking for the FERC to reject the deal, saying the deal was intentionally structured so FirstEnergy “could avoid a further write off of its investment in an aging coal plant that is no longer economic in wholesale markets” and have captive West Virginia ratepayers foot the bill.

The FERC’s order specifically cited Mon Power’s narrow request for proposal (RFP) issued in December as a reason for its rejection. A company issues an RFP when it seeks additional generation capacity, weighing offers from companies that could sell other power sources to get the lowest rate for consumers. Advocacy groups had argued Mon Power’s RFP was too narrow, specifically requesting to acquire 1,300 megawatts of additional power, the exact amount the Pleasants plant can generate.

“While we appreciate and recognize Mon Power’s legitimate need to address a potential capacity shortfall and to provide for its future capacity and energy needs, it should do so in a way that provides non-affiliate competing suppliers with the same opportunity as an affiliate to meet the utility’s needs,” the order said.

FERC denies Pleasants Power Power Station transfer


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