FERC Blocks Subsidy Deals For FirstEnergy, AEP In Ohio
April 28, 2016
The Federal Energy Regulatory Commission has blocked power purchase agreements approved by Ohio regulators last month that would have subsidized aging coal and nuclear plants owned by FirstEnergy and AEP Ohio. In two orders, FERC rescinded waivers it had granted to the two companies allowing them to buy power from their affiliate generators. Without the waivers, the utility cannot purchase power under the PPAs without a commission review. The agreements will now be subject to FERC’s affiliate abuse test, which directs companies to show evidence of either head-to-head competition, other unaffiliated buyers willing to pay similar prices for the same generation, or unaffiliated generators that have made sales at similar prices.