CITIZEN POWER ASKS COURT TO ORDER PUCO TO DO ITS JOB

FIRSTENERGY-GPU MERGER COULD HARM OHIO CONSUMERS

COLUMBUS, November 5/PRNewswire—Citizen Power, a regional utility watchdog organization, has asked the Ohio Supreme Court to order the Public Utilities Commission of Ohio to investigate whether FirstEnergy’s planned acquisition of New Jersey based General Public Utilities is in the public interest.

In its petition, filed on Friday, Citizen Power also requested that the Court expedite the hearing schedule because FirstEnergy and GPU plan to consummate the merger on November 7. “The expedited process is necessary largely because PUCO took so long to answer our petition,” said Citizen Power attorney John McCaffrey.

In December 2000, shortly after FirstEnergy filed its application to acquire GPU at other regulatory agencies, Citizen Power petitioned PUCO to make a determination as to whether the proposed merger would harm FirstEnergy customers. PUCO did not act on Citizen Power’s request until September, when it claimed it did not need to examine the merger.

“Here we have FirstEnergy paying billions of dollars to buy GPU and create the sixth largest utility in the country, a regional behemoth, yet PUCO refuses to even look into how this will impact Ohio ratepayers,” said Roger Odisio, economist with Citizen Power. “It would be nice to know, for example, what role the $9 billion in stranded costs customers are paying FirstEnergy plays in this deal, or who is going to protect FirstEnergy customers from being charged for the costs GPU is still paying for the Three Mile Island fiasco,” continued Odisio.

PUCO waited 9 months to answer Citizen Power’s petition. In the meantime, the Pennsylvania and New Jersey public utility commissions, the Federal Energy Regulatory Commission and the Securities and Exchange Commission have approved the proposed merger. However, according to attorney McCaffrey, “none of these investigations looked into the impact this merger would have on the Ohio retail market.”

PUCO claimed it did not need to assert its jurisdiction to review the FirstEnergy-GPU merger because it intervened in the FERC proceeding. Odisio, who worked as a FERC economist for 12 years, says this claim has no merit. “FERC looks at wholesale markets; it does not examine retail markets unless a state commission asks them to. Citizen Power asked FERC to look at retail effects in Ohio, but it refused because PUCO did not make this request.” concluded Odisio

“We hope the Ohio Supreme Court will protect Ohio electricity consumers,” said McCaffrey. “Citizen Power is asking the Court to order PUCO to bring FirstEnergy in and investigate whether its purchase of GPU will be harmful to the fledgling retail market in Ohio. You would think that PUCO would see the importance of conducting such an investigation,” concluded McCaffrey. -30-