Perhaps Ohio consumers should have been airing their own TV commercials in Ohio about "shopping" and AEP's capacity charges, because consumers are the big losers in today's PUCO decision.

"The Commission’s decision establishes a cost-based capacity price of $188.88 per MW-day but requires AEP to charge competitive electric suppliers at a lower market-based capacity price, known as the Reliability Pricing Model (RPM) price. AEP is permitted to defer the difference between the adjusted RPM price and the cost-based price."

Who do you think pays the amount AEP "defers?"  Consumers do.

What PUCO has done here is allow AEP to charge a higher capacity rate ($188.88), but allow FirstEnergy to pay the lower rate that they asked for ($20.01 per MW-day for 2012/2013, $33.71 for 2013/2014 and $153.89 for 2014/2015).  The difference between the two prices may be "deferred" by AEP.  This simply means that they book the amount of their loss in a special "deferred" account that PUCO will allow them to recover from consumers in their other rate case.

"The balanced outcome achieved in this case is based upon an extensive record that includes testimony from more than 20 parties,” PUCO Chairman Todd A. Snitchler stated."

Balanced?  The only thing being balanced here are the interests of two huge corporations.  Ohio consumers lose again.  How long does Snitchler think it's going to take consumers to figure this out and start another "prairie fire?" 

We've all been laughing at the AEP vs. FirstEnergy TV commercial beat down going on in the state of Ohio.  The companies are doing such a bad job presenting a coherent message, the public is left wondering what it's all about.  While the commercials focus on a current AEP rate case, the FirstEnergy rate case also going on right now before PUCO is much, much more interesting and has more potential to rip off consumers than anything AEP could dream up.

You see, FirstEnergy's current rate ripoff scheme is just a small part of their long-term, grand design to manipulate markets, laws, and administrative processes in a number of venues in order to produce incredible financial windfalls for the company.  FirstEnergy put quite a lot of thought into machinations that would beat their competitors at the EPA coal plant closure game and manipulate the situation into a financial benefit for the company.  FE's stockholders may see it as great business sense, but for Ohio's electric consumers, it's a huge financial loss.  Whether FE will get away with pushing the legal envelope, or whether evidence of possible misdeeds will begin to float to the surface like untethered bodies, remains to be seen.

It started several years ago with FirstEnergy's acquisition of Allegheny Energy and its plethora of scrubbed coal generation.  Tony the Trickster admitted as much on some annoying idiot's TV talk show.  He claimed that the EPA's new rule will benefit FirstEnergy, while other companies, like AEP, were wasting their time whining and trying to lobby the rules away.  Here's how FE's plan worked:

1.    Acquire bigger footprint and additional scrubbed coal generation capacity.

2.    Close un-scrubbed coal plants several years earlier than necessary, on very short notice, and create localized capacity shortages (especially in FirstEnergy's home base of Ohio). 

3.    Generation shortage will drive capacity prices in ATSI up more than double those in the rest of the RTO.  FirstEnergy will be the beneficiary of increased capacity prices.

4.    Closures will result in reliability issues.
    a.    Possibility for very profitable "Reliability Must Run" contracts to keep plants slated for closure open until reliability solutions can be implemented. 
    b.    Propose $1B in new transmission "reliability" solutions to be owned and constructed by FirstEnergy that source to other existing FirstEnergy-owned generation in order to lock in future market domination.  The transmission will predominantly become the financial responsibility of consumers in the ATSI zone, and will consist of many small upgrades to FirstEnergy-owned transmission so as to avoid any competition for projects under FERC's Order 1000.

5.    File Ohio rate case to lock in all that juicy profit and rush it through approvals!

6.    Engage powerful competitor in silly tit-for-tat PR battle over their own rate case, in order to focus attention elsewhere.

Here's what's turned up in FE's Ohio rate case:

Read the brief of the Ohio Consumer's Counsel.  This agency, tasked with representing the interests of Ohio's residential ratepayers, was chopped and crippled by Ohio's Governor last year.  The ever-struggling OCC claims that FE, with the assistance of PUCO, rushed their case through the process and disenfranchised the public.  FE sought waiver of many important rules and kept evidence to a minimum.  FE engineered an upfront settlement with certain parties, who all received kickbacks for their cooperation.  No parties representing residential ratepayers were included in the settlement, leaving the ratepayers without representation and bearing the cost of the kickbacks the cooperating parties received.  FE's switch to a three-year auction leaves ratepayers at risk of higher prices.  Sure, your rates may be "stable," but that will be stably HIGH.  FirstEnergy's generation affiliates will substantially benefit from the three-year auction.  A distribution rider produces excessive cost to consumers and locks FirstEnergy into a guaranteed revenue stream without rate transparency.  FirstEnergy escapes Ohio's "significantly excessive earnings" test.  FirstEnergy's claimed "benefits" for consumers are nothing but smoke and mirrors.

Read the brief of AEP Retail Energy Partners.  Be sure not to miss their handy-dandy table of all the settlement parties who financially benefited from their support of FE's plan, how much they got, and who gets to pay for it (mostly Ohio's residential ratepayers).  See also AEP's arguments about how FE is, in fact, the one stifling competition in Ohio by locking customers into purchasing FE's generation.  So much for a level playing field, FE, you little fibber!  And this -- it's such a great line, I've got to quote it:

"In effect, what is presented to the Commission and the ratepayers of the FE EDUs is much like a bad sequel.  Even if one liked the original movie, there is no assurance that the sequel will be equally enjoyable.  Unlike a movie, however, the FE EDU customers must stay to watch, once they have paid."

But probably the most stunning evidence submitted in the case comes from The Sierra Club's brief.  The brief details how FE severely underbid energy efficiency into PJM's RPM auction.  FE's failure to bid even the minimum amounts of EE required by state law into the auction artificially drove up ATSI's capacity price in PJM's 2015/16 auction.  FE's gaming of EE capacity cost ATSI consumers $600M in unnecessary capacity costs and prevented them from realizing an additional $39M in revenue!

But, what will all this mean for Ohio consumers if FE's plan is approved?  You're going to be paying more... lots more!

FirstEnergy has a bunch of hungry mouths to feed, such as:

CEO "Tony the Trickster" Alexander, who pulled in $18.3M in total compensation in 2011, according to FirstEnergy's SEC Proxy filing.

CFO Mark Clark, who pulled in $6.6M in 2011.

General Counsel Leila Vespoli, who pulled in $5.5M in 2011.

Charles Jones, President of FE Utilities, who pulled in $4.7M in 2011.

And then there's FirstEnergy's dead weight, retired executives, who still have their hand in the till:

Gary Leidich, who walked away with $4.4M in 2011.

Paul "Mr. Burns" Evanson, who walked away with the big prize - $14.4M in 2011.

So, while you're struggling to pay your increased electric bill in the future, remember how hard your friends at FirstEnergy are also "struggling."

If you've heard that the EPA is causing your electric bill to "skyrocket," you're getting incorrect "information" spoon-fed to you by propagandists with an agenda.  You need to work a little harder to get the unvarnished truth.  The truth is that your Ohio electric bill is going to "skyrocket" because of the financial scheming of FirstEnergy.

Remember, while all those TV commercials are kinda funny, the real story can only be found elsewhere.

Time for another comedy break, brought to you by AEP & FirstEnergy, who continue to burn their shareholders' money for your own personal entertainment (because NONE of this crap is recoverable through rates, right?)

The "squabble" got national coverage in Business Week recently, although the reporter seems to be among the larger crowd who just doesn't quite get it and is merely attracted by the bizarre nature of the whole spectacle... kind of like slowing down to rubberneck at the scene of an accident just to see if there are any severed heads rolling around in the median.  For instance, the reporter thinks the competition tit for tat series was about... basketball (it was dodgeball!)  Julie must have had a deprived childhood.  Business Week also attributed one of AEP's commercials to FirstEnergy (the lunch ladies).  Umm hmm... you two sure are getting out a coherent message.  Too bad that message is... WTF?

AEP seems oblivious that their own arrogance is sneaking up behind them and baring its teeth to take a bite.  But then again, why should they care when they have PUCO on a leash? 

AEP has re-focused their issue on commercials shamelessly fear-mongering about jobs.  Some are just plain old sappy.  Thomas Edison would be ashamed of you, AEP!  Unfortunately, the only ones they're scaring with this commercial are their own employees.  Was that what they intended?

No matter, the ads sort of fall flat because they direct viewers to "Fair Energy Ohio dot org" and use the logo from that site, which AEP dumped after being accused of running a front group.  AEP must have forgotten that they re-directed that url to go to Pablo the AEP Answer Man's website, which doesn't correlate with the targeted destination in the commercials and makes the average person think they typed something wrong, or worse yet, got hoodwinked into visiting AEP's website through propaganda.  Nice going, nincompoops!

FirstEnergy is running as fast as they can to catch up.  They actually produced a creative commercial all by themselves, so you can toss them a doggie biscuit.  Yeah, I know it's kinda cheesy and they're probably lucky some postal worker didn't happen by when they were abusing that mailbox and, well, go postal on them.

Next, FirstEnergy has been paying attention in class and attempts to stir up a little of that old "PUCO is AEP's lapdog" sentiment that caused such a ruckus earlier this year.  Unfortunately, they weren't quite dumb enough to make a commercial that comes right out and says so.  It's kind of like walking through a mine field to get that message across without alienating PUCO, isn't it?  So, FE experimented with a couple of different ways to get the job done without leaving fingerprints.  The newspaper editorial from one of FE's lapdogs. "Too bad, all but one member of the PUCO appear determined to serve AEP first."  The opinion from one of those angry small business owners, where PUCO is placed in position to look like the peoples' hero, but is actually intended to dredge up the old PUCO lapdog scenario.  Eh... it's not really working.  They should get the guy who

Oh, wait... that just wouldn't be sporting of me, now would it?  Keep tippy-toeing through the mine field and listening for that telltale "click," FE!

What have our friends been up to lately in the Ohio capacity charge rumpus?  Last time we checked in, AEP had scored the first victory and had moved their campaign to the AEP Ohio Answers website where Pablo the AEP Answer Man showcases some of the ugliest ties ever and drones on painfully in video after video that nobody watches.

You know what they say, imitation is the sincerest form of flattery.

FirstEnergy has a new video where Diffident Donny "answers your questions" too.  Except, they're not your questions.  Donny's handlers just made up a bunch of questions that they wanted him to "answer."  FirstEnergy has provided no way for "you" to ask questions, so it appears that they have hired an invisible mime to "ask" Donny made-up questions via text message, or something.

It looks like they gave Donny some happy pills or a couple of stiff drinks to take the starch out of him this time and sat him down in a 1970s disco set to "answer your questions."  It almost works, until you watch his eyes.  Blinking and breaking eye contact reveal the nervousness they couldn't medicate away.

But the real curiosity here is:  Has FirstEnergy hired the Clown College to do their advertising?  Donny "answering your questions" bears a striking resemblance to Corky DeMarco "answering your questions" about the PATH Project two years ago.

Okay...  FirstEnergy is trying to keep up with AEP and making absolutely no sense.  Really nothing new in that!

Keep the comedy coming, fellas!

AEP won its first real victory over FirstEnergy in the Ohio dodgeball game today when PUCO temporarily extended AEP's $255 per megawatt-day pricing scheme until a final decision is made in the case some time in July.

Pablo smirks.
Donny whines.

But wait... FirstEnergy has a new commercial!  Didn't PUCO watch the commercial before making their decision?  When FirstEnergy was unable to drum up any real grassroots support for its own money-making schemes, they simply borrowed some hatred of AEP from the case docket.

*sigh*

FirstEnergy still doesn't get it.

There's a little clue for FirstEnergy in the comments of the Columbus Dispatch article.  Do you think they can find it, or does someone have to beat them over the head with it?

What was it that made PUCO jilt AEP earlier this year when their rate increase incensed small business owners?  Was it because everyone hated AEP?  No, it was because everyone hated AEP's collusion with PUCO.  Fear for their own safety is the only thing that spurred PUCO into action against their master.  A yappy, little dog will protect the hand that feeds it until it realizes it's about to get punted in the head, at which time it will turn tail and run for its life.

If FirstEnergy wants to break up PUCO's waltz with AEP they need to whip up a little public anger accusing PUCO of, once again, being caught in a state of dishabille with AEP.

After AEP accused FirstEnergy of using "high-priced lobbyists" in their commercial last week, FirstEnergy swats back by accusing AEP of using "a totally made up group" to attempt to sway electric consumer opinion in the state of Ohio.

I give FirstEnergy an 8 on their new door-to-door commercial.  I laughed!  Of course, I probably laughed for a whole bunch of other reasons that they didn't intend. ;-)  Creativity improvement, FE!

Unfortunately for FirstEnergy, AEP responded by dumping their "totally made up group" and re-directing all traffic on www.fairenergyohio.org to their AEP-Ohio Answers website. Presto!  No more "made up group"!  It took AEP about 5 minutes to pop FirstEnergy's balloon.

AEP has added a new video to their "totally legitimate group."  They've taken Pablo outside, away from the corporate ego wall, where he can compete with traffic noise and distractions while he drones on for over two minutes.  Who do you think is going to watch that, AEP?  Nobody cares!  Even I stopped listening after about 15 seconds and spent more time looking at Pablo's ugly tie.  For some reason I started thinking about a telephone I had circa 1978:

And then I just started thinking about 1978.  Much more interesting than anything Pablo had to say.

Lobbyists and "totally made up groups."  It takes one to know one, doesn't it fellas?  Both companies were as thick as thieves spending ratepayer money on lobbyists and front groups while trying to get their PATH transmission project approved in WV, MD & VA over the past four years.  In fact, they are currently facing two formal complaints at FERC about their spending of well over a million dollars on lobbyists and front groups.  Obviously the companies know it's wrong and that public knowledge of lobbyists and front groups can turn public opinion against an idea or proposal.

What's next?  How about some testimonial and transfer from well-paid "experts," or perhaps more accusations that the other company has exerted improper pressure on PUCO to get their way?  1, 2, 3, go....