AKRON, Ohio, Nov. 28 /PRNewswire-FirstCall/ -- Leila L. Vespoli, senior
vice president and general counsel for FirstEnergy Corp. (NYSE: FE), today
testified before the Ohio House of Representatives' Public Utilities and
Energy Committee on Substitute Senate Bill 221 (Sub. SB 221), which
outlines a process for establishing electricity prices beginning in 2009.
In her remarks, Ms. Vespoli summarized the electric utility industry's
concerns that the bill does not offer a true hybrid approach - a critical
selling point of the Strickland administration's proposed energy policy -
in that it does not provide the Public Utilities Commission of Ohio
(Commission) with adequate statutory authority to continue the success of
rate- stabilization-type plans or to offer customers the benefits of a
competitive marketplace. She also pointed out that the bill legislatively
preserves very low, subsidized rates for large industrial customers.
Ms. Vespoli noted that rate plans work when coupled with competitive
options for customers. "We continue to believe that competitive markets
will deliver the best prices for customers over the long-term; will
continue to drive innovation, efficiency and productivity for our company
and for the industry; and will offer the kinds of products and services
customers want - including green products," Ms. Vespoli said.
Ms. Vespoli provided an open letter from several prominent economists -
including Massachusetts Institute of Technology's Paul Joskow, Alfred Kahn
from Cornell University and Nobel laureate Vernon Smith from George Mason
University - on the many benefits of competitive markets and urged
policymakers to ensure that customers would have access to those benefits
under Sub. SB 221.
"In effect, if we fail to preserve the market-based option for
utilities and customers, we create a number of legal problems that won't
easily or quickly be resolved," said Ms. Vespoli. "In order to avoid such
an outcome and achieve the desired hybrid approach, the bill should be
modified to provide the Commission with clear statutory authority to
negotiate ESPs (Electric Security Plans), coupled with a true market rate
option. Together, these two components will achieve the balanced
negotiation process that has succeeded in the past."
A complete text of Ms. Vespoli's testimony is available on
FirstEnergy's Web site, http://www.firstenergycorp.com.
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, or 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 our 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 Ohio and Pennsylvania, economic or weather
conditions affecting future sales and margins, changes in markets for
energy services, changing energy and commodity market prices, 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 including revised environmental requirements, the
uncertainty of the timing and amounts of the capital expenditures needed
to, among other things, implement the Air Quality Compliance Plan
(including that such amounts could be higher than anticipated) or levels of
emission reductions related to the Consent Decree resolving the New Source
Review 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 Nuclear Regulatory Commission including, but not limited to, the Demand
for Information issued to FENOC on May 14, 2007) as disclosed in our SEC
filings, the timing and outcome of various proceedings before the PUCO
(including, but not limited to, the Distribution Rate Cases and the
generation supply plan filing for the Ohio Companies and the successful
resolution of the issues remanded to the PUCO by the Supreme Court of Ohio
regarding the Rate Stabilization Plan and the Rate Certainty Plan,
including the deferral of fuel costs) and the PPUC (including the
resolution of the Petitions for Review filed with the Commonwealth Court of
Pennsylvania with respect to the transition rate plan for Met-Ed and
Penelec, the continuing availability of generating units and their ability
to continue to operate at or near full capacity, the ability to comply with
applicable state and federal reliability standards, the inability 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 ability
to access the public securities and other capital markets and the cost of
such capital, the outcome, cost and other effects of present and potential
legal and administrative proceedings and claims related to the August 14,
2003 regional power outage, the risks and other factors discussed from time
to time in our 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 us to predict all such factors,
nor can we assess the impact of any such factor on our 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.
We expressly disclaim any current intention to update any forward-looking
statements contained herein as a result of new information, future events,
or otherwise.
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