The leaders of FirstEnergy Corp. have signed agreements with two notable names from the finance world to raise $3.4 billion they say will help power a five-year capital spending plan they are growing by 15%.
FirstEnergy has separately agreed to deals with Blackstone Infrastructure Partners, which will in coming weeks buy $1 billion of the utility’s shares and have the right to appoint one director to the company’s board, as well as with Brookfield Super-Core Infrastructure Partners, which plans to spend $2.4 billion to take a 19.9% stake in FET, the holding company for FirstEnergy’s three regulated transmission units. The latter deal requires regulatory approval is expected to close in the first of next year.
Akron-based FirstEnergy’s executives, who have 6 million customers from Ohio to New Jersey, are using some of those proceeds to satisfy future equity plan needs but also are ramping up their 2021-2025 capex plans to about $17 billion from $14.8 billion. Of that latter increase, transmission projects will get about $1.4 billion more than previously planned. About half of the $17 billion will fall under the umbrella of grid modernization and resiliency work and $10 billion has been earmarked for sustainable energy investments.
“With these financings and, as importantly, long-term partnerships, FirstEnergy will be even better positioned to capitalize on the growth opportunities ahead and advance our company's key business priorities,” FirstEnergy President and CEO Steven Strah said in a statement. “These transactions will be key catalysts to fulfill our long-term strategy and drive smart grid and clean energy initiatives for our customers and communities.”
Strah and his team are looking to reduce FirstEnergy’s greenhouse gas emissions by 30% between now and 2030 and achieve carbon neutrality by 2050.
