American Electric Power said Tuesday that it had received a subpoena from the U.S. Securities and Exchange Commission’s Enforcement Division seeking documents related to how it might have benefited from the passage of Ohio H.B. 6 in 2019.
Designed initially to create a statewide charge to subsidize two Ohio nuclear power plants then owned by FirstEnergy, H.B. 6 was broadened to include a separate customer charge to subsidize two aging coal-fired plants owned by a consortium of public utilities, including AEP. Lawmakers this year stripped out the nuclear subsidizes, valued at more than $150 million a year for seven years.
The coal subsidies remain in effect until 2030 and will cost Ohio customers an estimated $700 million. A bill pending in the state Senate, S.B. 117, would remove those subsidies as well. Introduced in March, the legislation had a well attended committee hearing in May. No hearings have occurred since.
Whether the bill makes it out of committee before the legislature’s summer recess at the end of the month is questionable because lawmakers’ priority is passage of the state’s two-year budget bill by June 30.
Rammed through the legislature by then-House Speaker Larry Householder (R), H.B. 6 became the center of what federal prosecutors called the worst scandal in Ohio’s history after FBI agents raided Householder’s home in June 2020 as well as the homes of four lobbyists associated either with Householder or the Ohio Republican Party.
Without mentioning FirstEnergy, but clearly referring to the company, federal prosecutors alleged that Householder and his associates used $60 million in corporate dark money to pass the bill. Householder at his associates have been indicted on racketeering charges. FirstEnergy has since fired its CEO and four other top executives.
In a brief note to investors Tuesday, AEP said the SEC subpoena sought “various documents, including documents relating to the benefits to the company from the passage of H.B. 6 and documents relating to our financial processes and controls.”
“AEP is cooperating fully with the SEC’s subpoena,” AEP said. “Although we cannot predict the outcome of the SEC’s inquiry, we do not believe the results of this inquiry will have a material impact on our financial condition, results of operations or cash flows.”
In an email, a spokesman said the company would not provide a copy of the subpoena. “The notice we issued today is an update on H.B. 6-related items that we committed to provide to investors,” said Scott Blake, media relations and policy communications manager.
AEP’s share price fell 3.15% over the day, closing at $82.97.