FirstEnergy put the project on hold shortly after the Public Utilities Commission of Ohio approved the development. The utility wants clarification on how they will be reimbursed for approximately $36 million in costs, which is half the cost of the project. The United States Department of Energy has already agreed to pay the other half as part $115 million from the DOE for smart grid pilot programs in Ohio, Pennsylvania and New Jersey.
In its application for the project, FirstEnergy asked for a minimal temporary increase rate increase for all of its customers to raise the $36 million. But the PUCO decided to take up the rate increase issue in a pending FirstEnergy rate case that could be months away.
In an official statement, FirstEnergy accused the commission of jeopardizing the project and the grant, which requires local matching funds. “The project has potential benefits for our customers and would bring capital investments and jobs to our region. Today’s action is particularly surprising in light of the widespread support we received for our federal stimulus application. However, without approval of the matching funds, we are not in a position to move forward.”
As proposed, the pilot program would be voluntary and initially open to 5,000 randomly selected Illuminating Co. residential customers. In exchange for the credits on the bills, participating customers need to cut back on their power or allow First Energy to do it remotely. There will be two rebates: 40 and 80 cents for every kilowatt-hour not used. The two tiered rebate is to help determine what level of credit will get consumers to reduce consumption.