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FirstEnergy Files Application To Consolidate Transmission Assets Into PJM
Posted by: gurufocus (IP Logged)
Date: August 17, 2009 02:22PM
Press Release: FirstEnergy Files Application To Consolidate Transmission Assets Into PJM
AKRON, Ohio, Aug. 17 /PRNewswire-FirstCall/ -- FirstEnergy (NYSE: FE) today filed an application with the Federal Energy Regulatory Commission (FERC) to consolidate its transmission assets and operations into PJM Interconnection (PJM). Currently the company\'s transmission assets and operations are divided between PJM and the Midwest Independent Transmission System Operator (MISO). The company announced plans for the consolidation on July 31.
The consolidation would move the transmission assets that are part of FirstEnergy\'s American Transmission Systems, Inc. (ATSI) subsidiary - which are located within the footprint of FirstEnergy\'s Ohio utilities and Pennsylvania Power - into PJM. Most of FirstEnergy\'s transmission assets in Pennsylvania, and those in New Jersey, already operate as part of PJM.
If approved, the consolidation would provide customers with the benefits of a more fully developed retail choice market, and the company with the operating efficiencies of a single RTO - with one set of rules, procedures and protocols.
ATSI has 32 interconnections with PJM - physical transmission ties that connect to other utility systems - compared to just three with MISO. In addition, PJM operates within a largely deregulated region and its market structure supports retail choice, as well as energy efficiency and demand response programs that help drive down prices for all customers.
FirstEnergy has requested that FERC rule on its application by December 17, 2009, to provide time to integrate ATSI into PJM. The consolidation is expected to be complete on June 1, 2011, to coincide with delivery of power under the next competitive generation procurement process for FirstEnergy\'s Ohio companies.
FirstEnergy is a diversified energy company headquartered in Akron, Ohio. Its subsidiaries and affiliates are involved in the generation, transmission and distribution of electricity, as well as energy management and other energy-related services. Its seven electric utility operating companies comprise the nation\'s fifth largest investor-owned electric system, based on 4.5 million customers served within a 36,100-square-mile area of Ohio, Pennsylvania and New Jersey; and its generation subsidiaries control more than 14,000 megawatts of capacity.
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 our management\'s intents, beliefs and current expectations. These statements typically contain, but are not limited to, the terms "anticipate," "potential," "expect," "believe," "estimate" 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. Actual results may differ materially due to the speed and nature of increased competition in the electric utility industry and legislative and regulatory changes affecting how generation rates will be determined following the expiration of existing rate plans in Pennsylvania, the impact of the PUCO\'s regulatory process on the Ohio Companies associated with the distribution rate case, economic or weather conditions affecting future sales and margins, changes in markets for energy services, changing energy and commodity market prices and availability, replacement power costs being higher than anticipated or inadequately hedged, the continued ability of FirstEnergy\'s regulated utilities to collect transition and other charges or to recover increased transmission costs, maintenance costs being higher than anticipated, other legislative and regulatory changes, revised environmental requirements, including possible greenhouse gas emission regulations, the potential impacts of the U.S. Court of Appeals\' July 11, 2008 decision requiring revisions to the CAIR rules and the scope of any laws, rules or regulations that may ultimately take their place, the uncertainty of the timing and amounts of the capital expenditures needed to, among other things, implement the AQC Plan (including that such amounts could be higher than anticipated or that certain generating units may need to be shut down) or levels of emission reductions related to the Consent Decree resolving the NSR litigation or other potential regulatory initiatives, adverse regulatory or legal decisions and outcomes (including, but not limited to, the revocation of necessary licenses or operating permits and oversight) by the NRC, Met-Ed\'s and Penelec\'s transmission service charge filings with the PPUC, the continuing availability of generating units and their ability to operate at or near full capacity, the ability to comply with applicable state and federal reliability standards, the ability to accomplish or realize anticipated benefits from strategic goals (including employee workforce initiatives), the ability to improve electric commodity margins and to experience growth in the distribution business, the changing market conditions that could affect the value of assets held in FirstEnergy\'s nuclear decommissioning trusts, pension trusts and other trust funds, and cause it to make additional contributions sooner, or in an amount that is larger than currently anticipated, the ability to access the public securities and other capital and credit markets in accordance with FirstEnergy\'s financing plan and the cost of such capital, changes in general economic conditions affecting the company, the state of the capital and credit markets affecting the company, interest rates and any actions taken by credit rating agencies that could negatively affect FirstEnergy\'s access to financing or its costs and increase its requirements to post additional collateral to support outstanding commodity positions, letters of credit and other financial guarantees, the continuing decline of the national and regional economy and its impact on FirstEnergy\'s major industrial and commercial customers, issues concerning the soundness of financial institutions and counterparties with which FirstEnergy does business, and the risks and other factors discussed from time to time in its SEC 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 its 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 any forward-looking statements contained herein as a result of new information, future events, or otherwise.
Source: PRNewsWireFE is in the portfolios of Brian Rogers of T Rowe Price Equity Income Fund, Dodge & Cox, Kenneth Fisher of Fisher Asset Management, LLC.
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