Map by IEEFADavid Schlissel, the director of resource planning analysis at the Institute for Energy Economics and Financial Analysis (IEEFA), has written an article sub-titled June 1 Marks the Start of a New Year in PJM Capacity Markets and an Abrupt 70% Drop in FirstEnergy's Revenues on Selling Generation Capacity from Its Sammis [Coal] and Davis-Besse [Nuclear] Power Plants.
The article begins:
It came as quite the paradox when CEO Chuck Jones announced in April that the company’s Sammis and Davis-Besse plants had “contributed to” first-quarter earnings.
After all, FirstEnergy had been trying to get Ohio state officials to go along with a consumer-financed bailout of these failing assets—all part of a corporate scheme our research has shown would cost ratepayers $4 billion. The premise of the FirstEnergy bailout proposal, which federal regulators recently put on hold, is that outdated generators like the coal-fired Sammis and the nuclear-powered Davis-Besse are losing money because they can’t compete anymore.
If these two plants did indeed “contribute to” FirstEnergy earnings, it was only from FirstEnergy selling their capacity at inflated prices into regional markets. And that ends today.
Schlissel reports that FirstEnergy gouged ratepayers in northern Ohio $600 million, in the past year alone, in excessive charges. FirstEnergy cynically manipulated this advantage several years ago, by gaming the system in terms of efficiency it should have bid into the PJM auction at the time, but did not.
Schlissel concludes his article with this observation:
This change will severely reduce, if not eliminate, any supposed earnings contributions from the Sammis and Davis-Besse plants. And it will make these units, along with similarly uncompetitive plants in PJM, even less financially viable than ever. (emphasis added)
As recently reported by Midwest Energy News, FirstEnergy's latest bailout scheme would "make Houdini blush," given its contortions in seeking to get around a rejection by the Federal Energy Regulatory Commission.
What can you do as a resident of OH? Contact Gov. Kasich. Contact your state representative and your state senator. Contact the Public Utilities Commission of Ohio. Urge that FENOC's latest version of its bailout request be blocked at the state level, and not allow FENOC to do an end run around the FERC ruling, at massive ratepayer expense.
You can also thank the State of Ohio Office of Consumers' Counsel for his good work in opposition to this bailout, from the start.
Beyond Nuclear has helped lead a grassroots environmental coalition since 2010 in officially resisting the 20-year license extension sought by FirstEnergy at its problem-plagued Davis-Besse atomic reactor. Contentions have included: the safety-significant severe cracking of the concrete containment Shield Building, which has grown a half-inch worse every time it has freezed at the site since late 2012, and will continue to do so; risky steam generator replacements; and the simple fact that wind power alone, or solar photo-voltaics alone, and certainly the two in combination, coordinated with compressed air energy storage capabilities FirstEnergy already owns, could readily replace Davis-Besse's 908 Megawatts of electricity, reliably, likely much more affordably, and very certainly more safely, cleanly and securely.