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PUCO Audit On FirstEnergy Finds 'Minor Non-Compliance' With Some Affiliates

By Andy Chow

Published September 14, 2021 at 1:00 PM EDT

FirstEnergy headquarters in Akron [Annie Wu / Ideastream Public Media] — FirstEnergy headquarters in Akron

An audit of FirstEnergy has found eight areas in which the utility committed a form of "minor non-compliance" with corporate separation rules.

The report from the Public Utilities Commission of Ohio, or PUCO, looked into whether FirstEnergy followed rules on corporate separation during its interactions with its regulated affiliates.

FirstEnergy Corp. has affiliates that distribute electricity to homes. It also has companies that compete in the marketplace, such as FirstEnergy Advisors which bills itself as an "impartial" adviser for picking an energy supplier.

Ohio law has specific requirements to make sure FirstEnergy doesn't gain an advantage in the market because of its affiliation with those regulated entities.

The PUCO audit found eight areas where FirstEnergy committed "minor non-compliance."

For example, Ohio Administrative Code says an electric utility cannot "through a tariff provision, a contract, or otherwise, give its affiliates or customers of affiliates preferential treatment or advantages over nonaffiliated competitors of retail electric service or their customers in matters relating to any product and/or service."

The audit states an affiliate called FirstEnergy Products "has a competitive advantage by using the utility name and having access to the utility billing option."

Other examples of different entities sharing the same FirstEnergy named were noted as minor non-compliance.

"While we are currently reviewing the PUCO’s audit report, we appreciate the auditor's feedback and are open to making any necessary improvements in corporate separation compliance," FirstEnergy spokesperson Jennifer Young said in a statement.

The audit started federal investigators accused FirstEnergy of a $61 million bribery scheme to get a nuclear bailout law passed, which FirstEnergy has admitted to.

An administrative law judge with the PUCO will look over the findings to determine the next steps, such as a possible hearing.