FirstEnergy Corp. and Allegheny Energy, Inc., along with all parties to their merger proceeding in West Virginia, today filed a comprehensive settlement with the West Virginia Public Service Commission (WVPSC) that resolves all issues raised in the case.  The filing includes a commitment for a regional headquarters for Allegheny Power’s West Virginia utility operations, a $7.5 million rate reduction over two years for Allegheny Power’s West Virginia customers, enhanced customer service and reliability, and expanded support for Dollar Energy Fund.

“We are pleased to have reached agreement with the parties to our merger case in West Virginia and look forward to providing additional benefits to customers and communities in West Virginia,” said Anthony J. Alexander, President and Chief Executive Officer of FirstEnergy.

“We appreciate the support of all the parties to the settlement,” said Paul J. Evanson, Chairman, President and Chief Executive Officer of Allegheny Energy. “This agreement strengthens our commitments to the state and will ensure a strong partnership with West Virginia for years to come.”

In addition to the commitments made in the initial merger application, the settlement includes the following:

• A regional headquarters operation for Allegheny Power’s West Virginia utility operations within the service territory of Monongahela Power.
• $7.5 million in rate reductions over a two-year period for Allegheny Power’s West Virginia customers.
• Customer service as well as reliability commitments aimed at reducing the duration of outages.
• A commitment to maintain customer call center operations in Fairmont for at least five years.
• Additional funding totaling $500,000 over a four-year period for Dollar Energy Fund in West Virginia.
• Specific demand-side management and energy efficiency savings levels in Allegheny Power’s West Virginia service territories.

Parties signing the petition include Staff of the WVPSC, the West Virginia Consumer Advocate Division, West Virginia Energy Users Group, the Utility Workers of America, AFL-CIO and UWUA System Local 102-O, West Virginia Citizen Action Group, Local Union 2357 and Local Union 50 of the International Brotherhood of Electrical Workers, the West Virginia State Building and Construction Trades Council, and the Marion County Commission.

The petition, which resolves all issues raised by these parties in the FirstEnergy-Allegheny Energy merger case, is subject to approval of the WVPSC.

The companies filed their merger application with the WVPSC on May 18, 2010.  In it they committed to no net job losses at the utility operating companies for at least two years as a result of involuntary attrition related to the integration process; to expand FirstEnergy’s Power Systems Institute program in West Virginia; to maintain Allegheny Power’s customer call center and transmission operations center in Fairmont; and continued economic development and community support.

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FirstEnergy Corp. and Allegheny Energy, Inc., along with 18 parties to their merger in Pennsylvania, today filed with the Pennsylvania Public Utility Commission (PaPUC) a comprehensive settlement that addresses issues raised in the case.  The filing includes additional commitments related to employment levels in Greensburg and Westmoreland County, distribution rate credits for West Penn Power customers, a distribution rate freeze for FirstEnergy’s Pennsylvania utility customers, and support for renewable and sustainable energy and customer choice.

“We are pleased to have the support of the majority of parties to our merger case,” said Anthony J. Alexander, President and Chief Executive Officer of FirstEnergy.  ”This settlement builds on the significant commitments we’ve made to the Commonwealth and provides additional benefits to employees, customers and the competitive marketplace.”

“We appreciate the cooperation of all the parties to the settlement,” said Paul J. Evanson, Chairman, President and Chief Executive Officer of Allegheny Energy. “This agreement resolves a wide range of issues and should ensure we have a strong presence in our Pennsylvania communities for many years to come.”

In addition to the commitments made in the initial merger application, the settlement includes the following:

• A five-year commitment to maintain the following employment levels in Greensburg and Westmoreland County: at least 800 jobs for the first year after the merger closes, 675 jobs for the following 12 months, 650 jobs for the next year and 600 for the following two-year period.  These employment levels may be adjusted to reflect the number of employees who voluntarily leave the company during these time periods.  Also, in the final two years, employment levels in these areas could be affected by overall employment changes made at  FirstEnergy companies in response to business conditions.  Allegheny staffing levels in Greensburg are expected to be approximately 845 in early 2011.
• Nearly $11 million in customer credits for West Penn Power residential customers over a three-year period.
• A distribution rate freeze through October 1, 2012, for customers of FirstEnergy’s current Pennsylvania electric companies – Metropolitan Edison (Met-Ed), Pennsylvania Electric (Penelec) and Pennsylvania Power.
• Reliability improvements aimed at reducing the number and duration of outages for West Penn Power customers.
• Additional funding for the West Penn Power Customer Assistance Program.
• A credit for costs related to energy-efficiency and conservation programs for West Penn Power customers due to recently proposed changes in implementing its smart meter implementation plan.
• Long-term contracts for the purchase of Solar Photovoltaic Alternative Energy Credits between 2011 and 2021.
• A commitment of contributions to the West Penn Power Sustainable Energy Fund.
• Outreach to West Penn Power customers – including the establishment of a retail choice ombudsman – to promote and encourage customer choice and shopping.
• Additional customer usage information to competitive generation suppliers to help support a vibrant competitive marketplace in Pennsylvania.
• Establishment of a formal process to ensure power quality issues are addressed for industrial customers of FirstEnergy and Allegheny Energy in Pennsylvania.

“I am pleased that as a result of our discussions, FirstEnergy has made a five-year commitment to keep good, family-sustaining jobs here in the Greensburg area, especially in this troubled economy,” said Pennsylvania State Senator Kim Ward, (R-39th).

Parties signing the petition include the Pennsylvania Public Utility Commission Office of Trial Staff; the Pennsylvania Office of Consumer Advocate; International Brotherhood of Electrical Workers; Utility Workers Union of America (UWUA), AFL-CIO and UWUA System Local No. 102; The Pennsylvania State University; the Met-Ed Industrial Users Group; the Penelec Industrial Customer Alliance; the West Penn Power Industrial Intervenors; Pennsylvania Department of Environmental Protection; Citizens for Pennsylvania’s Future (PennFuture); Clean Air Council; the Pennsylvania Rural Electric Association; Constellation New Energy, Inc.; Constellation Energy Commodities Group; the Pennsylvania Mountains Healthcare Alliance; the West Penn Power Sustainable Energy Fund; the York County Solid Waste and Refuse Authority; and ARIPPA.  The petition, which resolves all issues raised by these parties in the FirstEnergy-Allegheny Energy merger case, is subject to approval of the Pennsylvania Public Utility Commission.

The companies filed their application with the PaPUC on May 14, 2010.  In it they committed to operate a regional headquarters for West Penn Power at the current Allegheny Energy headquarters building in Greensburg, Pennsylvania; no net job losses at the utility operating companies for at least two years as a result of involuntary attrition related to the integration process; to establish a new Power Systems Institute program in Pennsylvania; and continued economic development and community support.

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