Crescent-News.com - First Energy to increase rates over three years

Under a proposed plan filed by FirstEnergy Corp. companies, electric bills in the area will increase by more than 15 percent over the next three years, starting in 2009.

FirstEnergy's companies -- Toledo Edison, Ohio Edison and Cleveland Electric Illuminating Co. (CEI) -- filed a comprehensive electric security plan (ESP) with the Public Utilities Commission of Ohio on Thursday.

Under the plan, customer rates will increase an average of 5.3 percent in 2009, 4 percent in 2010 and 6 percent in 2011. If approved, the ESP would represent the first increase in base rates since 1990 for Ohio Edison customers and first since 1996 for Toledo Edison and CEI customers.

According to a news release issued by FirstEnergy Corp., the percentage change in rates will vary depending on usage.

The impact on a typical residential monthly bill from Toledo Edison based on 750 kilowatt-hours would be a decrease of 16 cents in 2009, then an increase of $3.06 in 2010, and an increase of $3.30 in 2011.

"We are pleased to offer a plan that protects customers from the kind of rate shock experienced in other states while providing for appropriate investments in system reliability," said Anthony Alexander, president and chief executive officer of FirstEnergy.

Columbus-based American Electric Power is seeking a 45 percent rate increase over three years and Duke Energy out of Cincinnati is seeking an 11 percent rate increase over three years.

"The anticipated impact of the Electric Security Plans would be a one-two punch to customers' wallets, as any rate increases would be on the heels of the higher distribution rates proposed by most of Ohio's major electric and natural gas utilities," said Ohio Consumers' Counsel's Janine Migden-Ostrander.

FirstEnergy's proposed rates reflect the end of transition cost recovery for all three companies, including CEI, which was scheduled to continue collecting regulatory transition costs through 2010.

"Considering our costs to produce and deliver electricity have increased dramatically since our last base rate cases were decided more than a dozen years ago, we've designed a plan that provides for modest increases in electricity prices over the next three years," said Alexander.

The FirstEnergy plan also includes:

-- financial support for new programs to enhance efficiency and economic development -- funding that would be provided by the company but not recovered through customer rates. This includes $25 million for energy-efficiency programs, and $25 million for economic development and job retention programs through 2013.

-- an option for the PUCO to approve a favorably priced short-term ESP that would allow more time to consider the longer-term ESP or to conduct a competitive bid, if needed.

-- an option for the PUCO to move to market-based generation pricing in 2011, if the market would provide a more favorable generation price than the ESP.

A final decision on the proposed plan is expected to be made within the next 150 days.