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HB 6 regulatory cases weigh what FirstEnergy’s Ohio utilities should pay • Ohio Capital Journal [1]
['Kathiann M. Kowalski', 'Canary Media', 'Morgan Trau', 'Nick Evans', 'More From Author', '- August', '.Wp-Block-Co-Authors-Plus-Coauthors.Is-Layout-Flow', 'Class', 'Wp-Block-Co-Authors-Plus', 'Display Inline']
Date: 2025-08-06
“While FirstEnergy Corp. engaged in criminal conduct … there is no evidence that the Companies extended an undue preference or advantage to any affiliate,” the brief says.
However, Ohio’s corporate separation law bans regulated utilities from favoring or subsidizing unregulated electricity production, and the majority of the HB 6 subsidies were for FirstEnergy Solutions’ nuclear plants.
FirstEnergy’s utilities also claim they properly spent the unlawful rider money “directly or indirectly” for grid modernization, as the PUCO required in a 2016 order, and that it can’t be refunded because of a 2019 ruling by the Ohio Supreme Court. Nonetheless, the company noted, roughly two-thirds of the total rider payments went back to customers under a 2021 settlement in a case about significantly excessive earnings.
The 2019 Ohio Supreme Court decision said the bill charge wasn’t refundable because it hadn’t yet been ruled unlawful. The court didn’t address whether restitution is appropriate for alleged misuses of the money, which came to light later. That’s the basis for the Ohio Manufacturers’ Association Energy Group and Office of the Ohio Consumers’ Counsel request for the charge to be refunded. And the case about significantly excessive earnings suggests the utilities had sufficient profits, which undermines claims that they needed the rider money, the consumers’ counsel noted.
Evidence at the regulatory hearings in June included a 2022 audit by Daymark Energy Advisors. Daymark found the spending could not be traced after it went into a money pool managed by an unregulated affiliate, FirstEnergy Service Co. And while the utilities made some upgrades to their distribution infrastructure, they recovered the funding through other bill charges, the auditor found. Daymark also concluded there was insufficient evidence for FirstEnergy’s claim that debt reduction and cuts to utilities’ pension obligations improved its ability to borrow money later for grid modernization.
“FirstEnergy has utterly failed to sustain its burden of proof and … its actions in furtherance of HB 6 and the bribes have and still are causing harm to customers,” lawyers for the manufacturers’ group wrote in their brief. Rather, evidence showed multiple violations, they wrote, citing testimony by the group’s expert, John Seryak, and by Ashley Brown, a former PUCO commissioner who testified on behalf of the state consumers’ counsel.
Limited review PUCO Chair Jenifer French has said the agency will “continue to follow the facts wherever they may lead” in the HB 6 saga. But critics say the commission is merely perpetuating a piecemeal approach to the corruption scandal, which began while Randazzo was still its chair.
“It just seems like there was a deliberate effort within the PUCO to break it up into multiple cases and just create a really confusing and convoluted process that has made it hard for the public to follow,” said Anderson, with the Energy and Policy Institute.
Regulators still have not ordered a full-scale investigation and management review of FirstEnergy’s utilities, which the Office of the Ohio Consumers’ Counsel requested nearly five years ago. Nor did the commission announce any investigation into its own activities after Randazzo’s first criminal indictment in late 2023.
Questions in the individual regulatory cases are certainly relevant, “but they’re marginal,” Brown told Canary Media. “The heart of the issue is this is a corporation gone rogue.”
FirstEnergy has announced multiple reforms, including a new ethics officer and other steps to improve corporate governance. But good corporate governance hinges on companies knowing there will be consequences for violations, Brown said.
Indeed, if regulators don’t require steep financial penalties, the manufacturers’ group suggested they should revoke the FirstEnergy companies’ ability to do business as monopoly distribution utilities.
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