AKRON, Ohio, May 27 /PRNewswire-FirstCall/ — FirstEnergy Corp.’s Ohio electric utility companies — Ohio Edison, The Cleveland Electric Illuminating Company and Toledo Edison — filed with the Public Utilities Commission of Ohio a request to establish a generation charge adjustment rider, as permitted under the companies’ previously approved Rate Stabilization Plan.
If approved, the rider would average $.002554 per kilowatt-hour, effective January 1, 2006, for all classes of customers. Residential customers’ riders would be $.002725 per kilowatt-hour, or $1.36 per month for those using 500 kilowatt-hours of electricity. For customers who are not served by alternative suppliers, the rider would be considered part of the generation charges for electricity. For customers who have switched suppliers, the generation shopping credit would increase by the same amount, providing a more favorable “price to compare.”
The filing reflects projected increases in fuel and related costs in 2006 compared with 2002 costs. At the end of 2006, the rider would be reconciled with actual costs for the year, and could result in an upward or downward adjustment in the level of the rider and generation shopping credit in 2007. Under the filing, adjustments would be made annually, with final reconciliation, if necessary, being completed in 2009.
Market prices for coal — the largest component of the proposed increase — have risen substantially since 2002. However, FirstEnergy has entered into long-term supply contracts that provide a hedge against escalating prices, mitigating the effect of the increases. Other cost increases that were reflected in the filing include those for natural gas; nuclear fuel expenses and disposal; lime, stabilizers and other additives; and emission allowances.
The generation charge adjustment filing was made under FirstEnergy’s Rate Stabilization Plan, which enables the company to request recovery of increased fuel and related costs. The Rate Stabilization Plan provides customers with protection against price volatility during the period of 2006 through 2008 — essentially keeping rates at 1990 levels for Ohio Edison customers and 1996 levels for Cleveland Electric Illuminating and Toledo Edison customers. The plan also provides up to $10 million in support of economic development projects, and $8.75 million in energy-efficiency program support for low- income customers.
Supplemental information is included in a May 27, 2005, letter addressed to the investment community, which is posted on the Investor Information section of 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.