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Potomac Edison Files Rate Case Designed to Enhance Reliability for its Maryland Customers

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Potomac Edison Files Rate Case Designed to Enhance Reliability for its Maryland Customers

Includes New Technology, System Redundancy and Enhanced Maintenance

PR Newswire

WILLIAMSPORT, Md., Aug. 24, 2018 /PRNewswire/ -- Potomac Edison, a subsidiary of FirstEnergy Corp. (NYSE:FE), today filed a comprehensive base rate case with the Public Service Commission of Maryland that contains new initiatives for the company to install more automated distribution equipment, replace additional aging underground electric cable, and trim trees more frequently to enhance service reliability for its 265,000 Maryland customers.

Potomac Edison Logo (PRNewsfoto/FirstEnergy Corp.)

It is the first base rate case Potomac Edison has filed in Maryland in nearly 25 years.

Potomac Edison has invested hundreds of millions of dollars in recent years to trim trees and complete projects designed to enhance service reliability, grid flexibility and modernization, and those efforts have benefitted customers.  Potomac Edison's Maryland customers experienced about 23 percent fewer outages in 2017 than they did in 2011, and when they experienced outages, those service interruptions were about 14 percent shorter in duration.

Potomac Edison's new rate plan offers enhanced programs designed to build further on those improvements to service reliability, including:

  • Moving to a four-year cycle from a five-year cycle to trim trees and instituting a special patrol to look for trees beyond right-of-way corridors that pose hazards to electric lines
  • Installing more distribution automation equipment that can automatically isolate problems, prevent entire circuit lockouts, and quickly restore electric service to the remainder of customers served by the line
  • Replacing more than 1,000 miles of aging underground electrical cable prone to an increasing number of failures due to direct contact with the ground
  • Installing electronic substation reclosers that analyze real-time data and can be remotely controlled by system operators to minimize the number of customers impacted by service interruptions on 68 distribution circuits

"Using good management and thoughtful planning over the years, we have enhanced service reliability for our customers while holding the line on rates," said James A. Sears, Jr., FirstEnergy's president of Maryland Operations.  "We are committed to sustaining these efforts by offering new programs to trim trees more often and install smarter equipment on our lines and in our substations that can help continue to reduce the size, length and frequency of outages."

Potomac Edison has traditionally had the lowest rates of any investor-owned utility in Maryland.  If approved, the new distribution rates would still be, on average, up to 60 percent lower than those charged today by other Maryland utilities.  Additionally, customers will receive the benefit of the recent federal tax cut as over $7 million annually in tax savings will be used to offset the costs proposed in this plan.

If the plan is approved as proposed, monthly bills for the typical residential customer using 1,000 kilowatt-hours would increase by about $6.00 per month or about 6 percent.  The proposed changes would raise the typical residential bill from $105 to $111.

Potomac Edison would expect to have the new rates go into effect in the first quarter of 2019. These changes would not impact Potomac Edison customers in West Virginia.

To help customers manage their bills, Potomac Edison offers an average payment plan, special payment plans, and access to energy assistance programs. For more information, visit FirstEnergy's website at www.firstenergycorp.com and click on Our Electric Companies section to choose Potomac Edison, or call the Customer Contact Center at 1-800-686-0011.

Potomac Edison's Maryland customers can also visit www.energysavemd.com to learn more about energy-efficiency products and programs to help save money.

Potomac Edison, a subsidiary of FirstEnergy Corp., serves about 265,000 customers in seven Maryland counties and about 140,000 customers in the Eastern Panhandle of West Virginia.  Follow Potomac Edison at www.potomacedison.com, on Twitter @PotomacEdison, and on Facebook at www.facebook.com/PotomacEdison.

FirstEnergy is dedicated to safety, reliability and operational excellence.  Its 10 electric distribution companies form one of the nation's largest investor-owned electric systems, serving customers in Ohio, Pennsylvania, New Jersey, West Virginia, Maryland and New York.  The company's transmission subsidiaries operate more than 24,000 miles of transmission lines that connect the Midwest and Mid-Atlantic regions.  Visit FirstEnergy online at www.firstenergycorp.com and follow on Twitter at @FirstEnergyCorp.

Editor's Note:  Potomac Edison today filed a comprehensive base rate case with the Public Service Commission of Maryland that contains new initiatives for the company to install more automated distribution equipment, replace additional aging underground electric cable, and trim trees more frequently to enhance service reliability for its 265,000 Maryland customers.  Photos showing similar work being done by Potomac Edison crews are available for download on Flickr.

Forward-Looking Statements: This news release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 based on information currently available to management. Such statements are subject to certain risks and uncertainties and readers are cautioned not to place undue reliance on these forward-looking statements. These statements include declarations regarding management's intents, beliefs and current expectations. These statements typically contain, but are not limited to, the terms "anticipate," "potential," "expect," "forecast," "target," "will," "intend," "believe," "project," "estimate," "plan" and similar words. Forward-looking statements involve estimates, assumptions, known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements, which may include the following:  the ability to successfully execute an exit of commodity-based generation that minimizes cash outflows and associated liabilities, including, without limitation, the losses, guarantees, claims and other obligations of FirstEnergy Corp., together with its consolidated subsidiaries (FirstEnergy) as such relate to the entities previously consolidated into FirstEnergy, including FirstEnergy Solutions Corp.(FES), its subsidiaries and FirstEnergy Nuclear Operating Company (FENOC), which have filed for bankruptcy protection; the potential for litigation and payment demands against FirstEnergy by FES, FENOC or their creditors, and the ability to successfully execute a definitive settlement agreement and obtain approvals from the Bankruptcy Court and others necessary for the comprehensive settlement as agreed to in principle; the risks associated with the bankruptcy cases of FES, its subsidiaries and FENOC, including, but not limited to, third-party motions in the cases that could adversely affect FirstEnergy, its liquidity or results of operations; the ability to experience growth in the Regulated Distribution and Regulated Transmission segments and the effectiveness of our strategy to operate as a fully regulated business; the accomplishment of our regulatory and operational goals in connection with our transmission and distribution investment plans; changes in assumptions regarding economic conditions within our territories, assessment of the reliability of our transmission and distribution system, or the availability of capital or other resources supporting identified transmission and distribution investment opportunities; the ability to accomplish or realize anticipated benefits from strategic and financial goals, including, but not limited to, the ability to grow earnings in our regulated businesses, continue to reduce costs through FE Tomorrow, FirstEnergy's initiative launched in late 2016 to identify its optimal organization structure and properly align corporate costs and systems to efficiently support a fully regulated company going forward, and other initiatives, and to successfully execute our financial plans designed to improve our credit metrics and strengthen our balance sheet; the risks and uncertainties associated with litigation, arbitration, mediation and like proceedings; the uncertainties associated with the deactivation of our remaining commodity-based generating units, including the impact on vendor commitments, and as it relates to the reliability of the transmission grid, the timing thereof; costs being higher than anticipated and the success of our policies to control costs; the uncertainty of the timing and amounts of the capital expenditures that may arise in connection with any litigation, including New Source Review litigation, or potential regulatory initiatives or rulemakings; changes in customers' demand for power, including, but not limited to, changes resulting from the implementation of state and federal energy efficiency and peak demand reduction mandates; economic and weather conditions affecting future sales, margins and operations, such as significant weather events, and all associated regulatory events or actions; changes in national and regional economic conditions affecting FirstEnergy and/or our major industrial and commercial customers, and other counterparties with which we do business; the impact of labor disruptions by our unionized workforce; the risks associated with cyber-attacks and other disruptions to our information technology system that may compromise our generation, transmission and/or distribution services and data security breaches of sensitive data, intellectual property and proprietary or personally identifiable information regarding our business, employees, shareholders, customers, suppliers, business partners and other individuals in our data centers and on our networks; the impact of the regulatory process and resulting outcomes on the matters at the federal level and in the various states in which we do business, including, but not limited to, matters related to rates; the impact of the federal regulatory process on Federal Energy Regulatory Commission (FERC) regulated entities and transactions, in particular FERC regulation of PJM Interconnection, L.L.C. (PJM)  wholesale energy and capacity markets and cost-of-service rates, as well as FERC's compliance and enforcement activity, including compliance and enforcement activity related to North American Electric Reliability Corporation's mandatory reliability standards; the uncertainties of various cost recovery and cost allocation issues resulting from American Transmission Systems, Incorporated's realignment into PJM; the ability to comply with applicable state and federal reliability standards and energy efficiency and peak demand reduction mandates; other legislative and regulatory changes, including the federal administration's required review and potential revision of environmental requirements, including, but not limited to, the effects of the United States Environmental Protection Agency's Clean Power Plan, Coal Combustion Residuals and Cross-State Air Pollution Rule programs, including our estimated costs of compliance, Clean Water Act (CWA) waste water effluent limitations for power plants, and CWA 316(b) water intake regulation; changing market conditions that could affect the measurement of certain liabilities and the value of assets held in our pension trusts and other trust funds, and cause us and/or our subsidiaries to make additional contributions sooner, or in amounts that are larger, than currently anticipated; the impact of changes to significant accounting policies; the impact of any changes in tax laws or regulations, including the Tax Cuts and Jobs Act, adopted December 22, 2017, or adverse tax audit results or rulings; the ability to access the public securities and other capital and credit markets in accordance with our financial plans, the cost of such capital and overall condition of the capital and credit markets affecting us and our subsidiaries; further actions that may be taken by credit rating agencies that could negatively affect us and/or our subsidiaries' access to financing, increase the costs thereof, letters of credit and other financial guarantees, and the impact of these events on the financial condition and liquidity of FirstEnergy Corp. and/or its subsidiaries; issues concerning the stability of domestic and foreign financial institutions and counterparties with which we do business; and the risks and other factors discussed from time to time in our United States Securities and Exchange Commission (SEC) filings, and other similar factors. Dividends declared from time to time on FirstEnergy Corp.'s common stock, and thereby on FirstEnergy Corp.'s preferred stock, during any period may in the aggregate vary from prior periods due to circumstances considered by FirstEnergy Corp.'s Board of Directors at the time of the actual declarations. A security rating is not a recommendation to buy or hold securities and is subject to revision or withdrawal at any time by the assigning rating agency. Each rating should be evaluated independently of any other rating. These forward-looking statements are also qualified by, and should be read together with, the risk factors included in our filings with the SEC, including but not limited to the most recent Quarterly Report on Form 10-Q, which risk factors supersede and replace the risk factors contained in the Annual Report on Form 10-K and previous Quarterly Report on Form 10-Q, and any subsequent Quarterly Reports on Form 10-Q or Current Reports on Form 8-K. The foregoing review of factors also should not be construed as exhaustive. New factors emerge from time to time, and it is not possible for management to predict all such factors, nor assess the impact of any such factor on our business or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statements. We expressly disclaim any obligation to update or revise, except as required by law, any forward-looking statements contained herein as a result of new information, future events or otherwise.

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SOURCE FirstEnergy Corp.

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