CITIZEN POWER

Public Policy Research Education and Advocacy

FOR IMMEDIATE RELEASE Contact: David Hughes

December 13, 2001 412/421-6072

DENIAL OF CITIZEN POWER AND ENRON INTERVENTIONS IS ILLEGAL

PUCO DECISION HURTS FIRSTENERGY RATEPAYERS

COLUMBUS, December 13/PRNewswire—Consumer watchdog group Citizen Power called the PUCO’s decision today to deny its right to intervene in the FirstEnergy shopping credit case “absolutely illegal”. “The Order cites no authority for denying our intervention, because there is no authority for PUCO to do that,” said David Hughes, Executive Director of Citizen Power. PUCO also denied Enron’s intervention on the same specious grounds.

Section 4903.221 of the Ohio Revised Code specifically provides for any “adversely affected” party to intervene in any PUCO proceeding provided the intervention is made in a timely manner and addresses the merits of the case. There is no question that the Citizen Power and Enron interventions meet the requirement of the law, and PUCO makes no attempt to argue otherwise.

The FirstEnergy transition plan Settlement required the Company to apply for PUCO approval of 2002 shopping credit levels. If FirstEnergy can show that 20% of its customers switched to a competitive supplier the Company can avoid having to increase the incentive part of the shopping credit for commercial and industrial customers in 2002.

FirstEnergy submitted numbers that purport to show that it has met the 20% target. Citizen Power and Enron intervened and disagreed with FirstEnergy’s claim on several grounds, including (1) the fact that FirstEnergy included switches to its own affiliate First Energy Solutions and (2) FirstEnergy’s claimed percentages are meaningless because the Company compares MWh sales of customers who switched on September 30, 2001 to total MWh sales from three years ago.

By accepting FirstEnergy’s bogus claims, PUCO is setting a precedent for future determinations as to whether the 20% target has been met. For example, this will likely insure that FirstEnergy will not have to refund any of the $500 million the Company put at risk should it not reach the 20% target.

“It’s no mystery why PUCO chose to avoid answering the questions we raised by denying our very right to intervene,” said Citizen Power economist Roger Odisio. “It appears that virtually all the switches FirstEnergy is counting are switches to its affiliate. It doesn’t take a Ph.D. in economics to understand that switches between affiliates of the same corporation have nothing to do with competition and should not be counted toward the 20% target. By denying our intervention, PUCO is trying to sweep this uncomfortable fact under the rug,” concluded Odisio.

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