Public Utilities Commission of Ohio requires FirstEnergy utilities to return further tax savings to customers
In a settlement approved by the Public Utilities Commission of Ohio (PUCO) this week, the utilities of FirstEnergy will be required to update their rates and return further savings from the federal Tax Cuts and Jobs Act to their customers.
“We are pleased to resolve the tax reform issues and will pass along the tax savings to customers,” Samuel Belcher, senior vice president and president of FirstEnergy Utilities, said. “We look forward to modernizing our electric system with advanced equipment that will help reduce the number and duration of power outages. Smart meters also will allow our customers to make more informed decisions about their energy usage.”
Under the settlement, the company’s Ohio customers will receive 100 percent of the tax savings generated by the federal tax cuts. Additionally, rates will be reduced by $35.1 million annually until PUCO approves new distribution rates. Customers will be credited with the return of $58.5 million in over-collections, $482.8 million for normalized tax deferrals to be returned over the next 25 years, and $194.4 million for property non-normalized tax deferrals returned over the next 10 years. On a month to month basis, the average residential customer will see bill reductions of around $4.
The settlement also approves FirstEnergy’s new grid modernization plan, allowing it to update the electric distribution system with automation equipment, real-time voltage controls, and smart meters. More than $500 million will be invested in the effort over the next three years, which will result in 700,000 new smart meters, the development of time-varying rates for customers, the installation of automated equipment on a minimum of 200 distribution lines for better security and control, as well as installation of voltage regulating equipment on more than 200 circuits for greater efficiency efforts.
FirstEnergy staff hope the investments will reduce both the length and frequency of customer outages, grant them greater access to energy usage data, and improve grid management overall. Customers will also have around $93.5 million drawn from them over five years for non-property, non-normalized tax deferrals.
