That proposal followed a commitment made two weeks ago by Chicago-based Exelon Corporation to provide the same amount of energy for $2 billion less with resources whose emissions would be 100 percent carbon-free.
“Dynegy agrees with Exelon that this process should be competitive,” Dynegy president and CEO Robert Flexon said in a prepared statement when his company’s plan was announced on Tuesday.
“We believe the counter-proposals are uniformly better for Ohio consumers and businesses than the AEP and FirstEnergy [plans], keeping and creating jobs in the state that stimulate economic growth and development rather than weakening Ohio’s competitive position,” Flexon added. “We ask for serious consideration from the PUCO and Ohio elected and state officials for our proposals.”
Meanwhile, additional information questioning the plan has been produced and filed by grid operator PJM Interconnection.
“The business case against the bailout has become particularly stronger” as a result, said Dick Munson of the Environmental Defense Fund, which also opposes FirstEnergy’s plan.
FirstEnergy’s revised plan would have its regulated utilities buy all the output from the Davis-Besse nuclear plant, the W.H. Sammis coal plant, and FirstEnergy’s share of power from two 1950’s era coal plants.
The utilities would resell the electricity in the competitive market, and distribution customers would pay any shortfall or get a credit for the difference between the resale price and the contract price. That price includes a guaranteed rate of return for FirstEnergy Solutions.
The proposed settlement that was filed last month would shorten the term to eight years instead of the original 15. Yet even the revised plan would boost a typical residential customer’s bill as much as $130 per year, according to the Office of the Ohio Consumer’s Counsel (OCC).
The settlement “taken as a whole, does not provide a net benefit to customers, is not in the public interest, and should be rejected by the PUCO,” said expert witness Matthew Kahal in supplemental testimony filed on December 30.
Under the settlement, FirstEnergy would also assume a small share of the potential downside to consumers, reinstate the energy efficiency programs it suspended after 2014, and make other changes.
Critics say some of those provisions could lead to additional changes that would increase consumers’ costs. One example is a section that would raise the fixed costshare of the bill for electricity distribution and could also discourage energy efficiency.
Similar concern focuses on provisions in the settlement for grid modernization.
Some programs that fall into that general category “may have benefits for customers,” said Rob Kelter of the Environmental Law & Policy Center (ELPC), which is among the parties who oppose the settlement. “But there’s also a lot of expense involved.”
Yet FirstEnergy has refused to produce documents about the details of the plans for grid modernization. The company claims no final versions exist and says any drafts are protected as attorney work product. It has also refused to provide supporting materials sought in follow-up requests, saying those were too broad or came later.
“Their plan may not be final yet, but we want documents that indicate what they intend to do. And that’s what discovery is all about,” Kelter said. “You don’t get to pick and choose what you want to give up to the other side.”
The big concern is that approval of the settlement might later be interpreted as “some type of preliminary permission” for whatever FirstEnergy might later submit—without the benefit of a full review beforehand, Kelter explained.