FirstEnergy subsidiary wins bankruptcy plan approval
TOLEDO, Ohio (AP) — A subsidiary of FirstEnergy Corp. that operates coal and nuclear plants in Ohio, Pennsylvania and West Virginia plans to emerge from bankruptcy protection by the end of the year after getting final approval from a federal judge.
But FirstEnergy Solutions also warned this week that it will take steps to close its nuclear plants in Ohio if a proposal to overturn a roughly $1 billion financial rescue for the two plants is allowed on the statewide ballot in 2020.
Ohio-based FirstEnergy Solutions, which has said its coal and nuclear plants are struggling to compete against cheaper energy sources such as natural gas and renewables, filed for bankruptcy last year and intends to separate from Akron-based FirstEnergy Corp.
A federal bankruptcy judge in Akron signed off on the company’s reorganization plan Wednesday after it finalized two union labor agreements.
“We are now in a position to successfully conclude the Chapter 11 process and will emerge from the restructuring as a fully independent energy company well-positioned to continue serving the needs of our 800,000 customers,” John Judge, the company’s president and CEO, said in a statement.
FirstEnergy Solutions has sought financial help from both the federal government and officials in states where the company operates. It persuaded Ohio lawmakers this year to tack a surcharge onto every electricity bill in the state and give its two nuclear plants near Toledo and Cleveland $150 million a year through 2026.
Company leaders had said that the plants would close without the financial rescue, costing the state thousand and the state’s main source of clean energy.
But the natural gas industry, which stood to lose out on the deal, wants to kill the rescue and is collecting signatures to put the issue on the ballot in November 2020.
FirstEnergy Solutions has gone to court to stop the ballot effort and this week said that a setback in the courts or the successful submission of petitions to put a referendum on the ballot would put the nuclear plants on shaky ground.
It added that it would be forced to begin looking at closing the plants “if alternative measures to provide needed financial support do not arise quickly.”
FirstEnergy Solutions already has said that its last coal-fired power plant in Pennsylvania will shut down in early November, two years earlier than it first announced. It blamed “a lack of economic viability in current market conditions.”