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Hearing on FirstEnergy power plant deal packed on day 1

By From staff and wire reports

CHARLESTON, W.Va. - The first day of a Public Service Commission hearing on a proposal to shift ownership of two subsidiaries of FirstEnergy was packed with consumer, environmental and retiree groups who oppose the plan.

The $1 billion power plant sale would shift full ownership of the Harrison Power station, in Haywood, to Mon Power. Meanwhile, Mon Power would sell its portion of the Pleasants Power station in Willow Island to AE Supply, giving AE Supply full ownership.

The AARP, Sierra Club, West Virginia-Citizen Action and other groups argue the Harrison Power Station is overvalued, and the deal concentrates too heavily on coal.

They also complain it does nothing to promote energy efficiency. Making consumers more efficient users of electricity would reduce demand, critics argue, and that would eventually save money.

But media outlets say officials with the Ohio-based utility defended the deal as a cost-effective way to meet a current shortfall in electricity production for customers of both Mon Power in northern West Virginia and Appalachian Power in the south.

FirstEnergy says the deal is a cheaper way to meet demand than buying power on the spot market.

"There really are real benefits to Mon Power to control their own destiny and own this asset," said Michael Delmar, FirstEnergy's director of regulated generation dispatch.

FirstEnergy says the deal would provide about 1,500 megawatts of additional power, or enough to supply about 1 million homes. That would meet demand through 2020, and excess capacity could be sold on the spot market to help offset costs to consumers.

The petition for the sale was filed with the PSC in November.

Since then, the PSC has received more than 1,500 public comments on the transaction. Chairman Michael Albert said at the hearing Wednesday that about 1,100 were opposed to the transaction, and 500 were in favor of it.

"This is not an easy decision obviously," he said. "There are strong held beliefs on both sides.  We have encouraged both sides to discuss settlement ... obviously they haven't been able to reach it."

Supporters of the deal include Local 304 of the Utility Workers Union of America, the International Brotherhood of Electrical Workers' District 4, the West Virginia Coal Association, the United Mine Workers of America and Pennsylvania-based CONSOL Energy.

The Harrison Power Station employs more than 200 workers and supports the operation of CONSOL's Robinson Run mine, where a belt feeds coal directly from the mine to the plant. That mine employs about 400 people.

Nearly two-dozen people are scheduled to give testimony to the PSC over the next three days - a timeline Albert called "optimistic." A decision may not come until June.

The FirstEnergy case is one of two such proposals the PSC is weighing.

Ohio-based American Electric Power wants to transfer its John Amos plant near St. Albans and its Mitchell facility near Moundsville to Appalachian Power, a Charleston-based subsidiary with 1 million customers in West Virginia, Virginia and Tennessee.

A hearing on that case is set for mid-July.



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