FirstEnergy’s Three-Year Rate Plan in Ohio Seeks to Support Upgrades, Reliability Efforts

FirstEnergy electric companies in Ohio announced plans to file their first Three-Year Rate Plan (TYRP) with the Public Utilities Commission of Ohio (PUCO) by May 22 amid the state’s recent legislation for electric rates.

Governor Mike DeWine signed House Bill 15 into law, which allows electric utilities to set distribution rates using a forward-looking approach that is reviewed by PUCO and updated annually for rate adjustments. FirstEnergy Corp. states that this differs from years prior, when electric rates were based on costs already spent.

The Illuminating Company, Ohio Edison, and Toledo Edison have signaled efforts behind the TYRP plan to support significant electrical system upgrades. FirstEnergy says this forward-looking approach will help provide its customers with a clearer view of planned utility work that impacts their bills.

Planned work includes an average of $800 million annually to upgrade facilities, neighborhood poles, and technology improvements that help electrical systems during severe weather events. The TYRP plan also includes an average of $83 million annually, which will be used to expand tree trimming efforts near power lines. FirstEnergy claims that untrimmed trees were one of the top causes of outages for its customers.

If PUCO approves the TYRP, residential monthly bills for Ohioans would reportedly be estimated to grow more slowly on an average annual basis (through 2030) compared to the 10-year U.S. inflation rate average of 3.3%. FirstEnergy noted that the plan only affects the distribution part of customer bills, and not the electricity supply set by third parties.

For a typical non-shopping residential customer using roughly 1,000 kilowatt-hours, FirstEnergy Ohio says increases between the three electricity companies would range 2.2% ($4.26) and 2.8% ($5.30) monthly on an annual basis over the course of the three-year period.

"Our TYRP is about careful and balanced planning," said Torrence Hinton, president of FirstEnergy Ohio, in a statement. “We're building the three-year plan around the work that will make the biggest difference, keeping costs in check and clearly explaining what customers are paying for."

FirstEnergy Corp.'s electric distribution companies serve six million customers across Ohio, Pennsylvania, New Jersey, West Virginia, Maryland, and New York.