Company nixes Pleasants Power deal
PARKERSBURG – Two utilities have informed the West Virginia Public Service Commission they will neither accept the commission’s conditions for the purchase of the Pleasants Power Station nor seek a rehearing with a federal agency that rejected the deal.
Allegheny Energy Supply Co. had planned to sell the Pleasants facility to Monongahela Power and Potomac Edison, all subsidiaries of FirstEnergy Corp., for $195 million, which was opposed by consumer groups. The sale would have placed the facility into the regulated market in West Virginia and would have been guaranteed a profit.
The Federal Energy Regulatory Commission in January denied the request to buy the power plant.
On Jan. 26, the Public Service Commission approved the sale with the conditions that imposed limits on the costs to customers, recovery of closing costs if the plant is retired early and costs related to prior operations of the plant or problems with an impoundment.
The utilities have decided not to file a request for a rehearing with the Energy Regulatory Commission and will not accept the conditions from the Public Service Commission, Gary A. Jack, a senior corporate counsel for the utility companies, said in a letter to the commission on Monday.
The conditions “would result in Mon Power assuming exposure and significant commodity risk, which is inconsistent with FirstEnergy’s announced corporate strategy,” the letter said.
“Therefore the asset purchase agreement between the companies and Allegheny Energy Supply Co. LLC will be terminated in accordance with its terms and the proposed transaction will not be consummated,” the letter said. “The companies do not believe that the commission’s requirements for them, to file recalculated revenue requirements, proposed tariff sheets and indemnity agreements within 30 days of the date of order or by Monday, Feb. 26, are needed in light of these circumstances.”
FirstEnergy “will continue to evaluate its options,” First Energy spokesman Todd Meyer said.
“We have not made any final decisions or announcements concerning the future of our competitive generation plants, including whether they will be sold or closed,” he said. “While we are disappointed with this outcome, we are very appreciative of the hard work and dedicated efforts by our employees, community and business leaders and other stakeholders to try to bring the plan to fruition.”