FirstEnergy CEO talks about coming out of Ohio's huge bailout scandal and facing the future
The new CEO of Ohio’s largest electric utility says the company is putting the nuclear power plant bailout scandal behind it.
FirstEnergy’s new boss is talking about what’s ahead after the corruption case involving House Bill 6, which resulted in 20 years in prison for former House Speaker Larry Householder and five years for former Ohio Republican Party chair Matt Borges. Householder and Borges were arrested July 21, 2020. Two of the five others arrested at the same time, Juan Cespedes and Jeff Longstreth, pleaded guilty and cooperated with the government and are awaiting sentencing. The other, Neil Clark, died by suicide. Generation Now, a dark money group that took millions from FirstEnergy for Householder to use to pay bribes, has also pleaded guilty.
Brian Tierney is the third FirstEnergy CEO since Chuck Jones was fired in October 2020 after an internal investigation. He didn’t work for FirstEnergy until last month, almost two years after the utility admitting to bribery in the House Bill 6 scandal and paid a $230 million fine in a deferred prosecution agreement.
"I think the company has done a great job putting a period on that scandal and putting it behind us, taking responsibility with the Department of Justice, trying to settle the cases that have been filed against us, trying to deal with people transparently, honestly, openly and admit what we did, put it behind us and focus on the future," Tierney said.
Many ratepayers were shocked at their June electric bills, as prices soared and even doubled in some cases. Tierney said those higher prices that are hitting now were actually determined months ago.
“Unfortunately, that auction happened in the autumn of last year when power prices, gas prices were spiking associated with the war in Ukraine," Tierney said. "So for customers that haven't switched, they're going to pay a higher price.”
Customers can buy electricity directly from FirstEnergy or from other providers, or they can join an electric aggregator, which is a government-backed group that buys in bulk. Ratepayers can check the Public Utilities Commission of Ohio’s website to find providers with lower prices.
Tierney said the company has been transitioning away from its competitive operations since 2018. Now, he said, "we focus on mostly wires. 95% of our rate base is wires delivering to customers in our five states that we serve with some generation to serve our customers in West Virginia and Maryland."
Tierney said as part of that transition, "we've repaired our balance sheet as well." He said FirstEnergy has raised $7.5 billion in equity for investments in infrastructure to improve reliability and prepare for higher loads as more industries turn to electricity.
"We're making the investments in wires. We're making the investments in reliability, sectionalization, other such things that we can do to make sure that reliability is improved, but making sure the capacity is there to allow all that to happen. We're incredibly focused on that," Tierney said.
Whether all this is to prepare for FirstEnergy to be sold, Tierney said, "If the board wanted to sell FirstEnergy, they wouldn't have hired me to come work here. I don't sell utilities. I don't have an experience with that. I don't think I'd be very good at it. What I do have experience in is helping companies perform better operationally and financially, and that's what they asked me to come here to do."