By Ted Caddell
After a yearlong battle to win approval from Ohio regulators for their controversial power purchase agreements, FirstEnergy and AEP Ohio asked the state last week to start over.
FirstEnergy asked the Public Utilities Commission of Ohio to withdraw its PPA and replace it with a customer charge that would still protect its aging power plants (14-1297-EL-SSO).
AEP whittled down its original request for PPAs for all of its 3,100-MW Ohio merchant fleet, asking PUCO for agreements covering only its 440-MW share of the Ohio Valley Electric Corp. (14-1693-EL-RDR, 14-1694-EL-AAM). AEP said it will stand by its commitment to develop 900 MW of renewable energy — a promise that convinced the Sierra Club to sign on to its plan — with certain provisos.
Both AEP and FirstEnergy are seeking to reformulate their plans in order to avoid a review by FERC. The commission ruled April 27 that the PPAs — in which AEP’s and FirstEnergy’s regulated utilities would purchase output from the companies’ merchant generators — must be reviewed under the Edgar affiliate abuse test (EL16-33 and EL16-34).
AEP CEO Nick Akins said the company would either lobby Ohio lawmakers to reregulate the state’s electricity market or sell off its Ohio fleet rather than submit to FERC review. FirstEnergy CEO Chuck Jones has also said he would welcome reregulation. (See All Eyes on AEP, FirstEnergy with Ohio PPAs in Doubt.)
FirstEnergy is asking for an expedited ruling from the commission by May 25. The deadline for parties to respond to AEP’s and FirstEnergy’s new proposals is May 12.
Rehearing Requests
The companies’ new requests came on the deadline for PPA opponents to seek rehearing of PUCO’s March 31 ruling.
Among those renewing their call for rejection of the PPAs were the Electric Power Supply Association, the Ohio Consumers’ Counsel, the Environmental Defense Fund, the Sierra Club (which is opposing the FirstEnergy deal but is still a party to the AEP agreement), the Retail Energy Supply Association and the PJM Power Providers Group.
The OCC noted that FERC rescinded the waivers “under which AEP Ohio claimed it could proceed with the PPA without FERC review, [so] accordingly, the PPA rider is effectively dead.”
Shannon Fisk, managing attorney at Earthjustice, a nonprofit law firm representing the Sierra Club, said Friday that FirstEnergy’s newest filing was “a transparent attempt to avoid FERC review.” He said he hopes PUCO “won’t join with FirstEnergy to snub FERC.
“It would be seriously inappropriate for a state commission to do that,” he said.
AEP Wants Stake in Renewable Projects
In its latest filing, AEP said it is committed to the renewable portion of its PPA agreement but wants to own half of the projects, rather than purchasing the power on the market. “This is especially vital given that AEP Ohio is attempting to fully honor the renewable commitment even though the previously featured affiliated PPA is no longer part of the PPA proposal,” the company wrote.
“The company is productively attempting to salvage rather than terminate the commitments made as part of the beneficial package of the stipulation in a reasonable and modest way,” it wrote. “The company is pursuing this even though the central feature of the affiliated PPA is no longer included.”