WV PSC Orders Audit of FirstEnergy Corp. Subsidiaries’ Lobbying Expenses Amid Ohio Bribery Scandal

March 29, 2023

Mountaineer News

West Virginia In-Depth

CHARLESTON, WV (Mountaineer News) - On March 2nd, the West Virginia Public Service Commission (PSC) issued an order requesting information on the lobbying activities of Monongahela Power Co. and Potomac Edison Co., both subsidiaries of FirstEnergy Corp., based in Akron.

As part of a focused management audit, the PSC will review whether FirstEnergy has attempted to charge Mon Power and Potomac Edison ratepayers for lobbying and promotion expenses in base rate increase requests. The PSC is responsible for ensuring that expenses passed on to ratepayers are reasonable and appropriate. The audit will also assess expenses included in expanded net energy costs cost recovery proceedings, covering 2018 to the present, and possibly further back if the PSC deems it necessary.

The PSC’s order states that as part of the upcoming base rate case, it expects an in-depth review of costs incurred by the companies for civic, political, and related activities, including lobbying and image building expenses. The PSC believes that a focused audit is necessary to ensure that such costs are not included in operating expense accounts, plant accounts, or other accounts that are typically considered when determining ratemaking revenue requirements.

The order refers to a bribery scandal in Ohio involving FirstEnergy over the past three years, which led to the conviction of former Ohio House Speaker Larry Householder and former Ohio Republican Party Chairman Matt Borges at the beginning of March. According to court documents, FirstEnergy allegedly spent over $60 million between 2018 and 2020 through a non-profit organization controlled by Householder and others. The funds were allegedly used to help Householder become House speaker, and later, to bribe signature collectors to stop collecting signatures to reverse House Bill 6, a bill that charges Ohio ratepayers to keep the Davis-Besse and Perry nuclear plants operating.