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City Alleges FirstEnergy Solutions Denied Requested 'Most Favored Nation' Status in Muni Agg. Contract By Stating No Other Aggregation Would Receive Better Treatment, Then Provided Superior Terms to NOPEC (Not Passing Polar Vortex Costs to NOPEC)
The City of Parma, Ohio has alleged that, in negotiating a municipal aggregation contract with the city, FirstEnergy Solutions rejected the city's desire for a clause ensuring that another aggregation would not have a more favorable contract, as FES allegedly said that this language was not necessary due to the fact that all aggregators had to sign identical agreements and that no aggregator would be allowed to deviate from the uniform agreement
However, Parma now finds its aggregation subject to the FirstEnergy Solutions polar vortex surcharge, while FES has said that the NOPEC aggregation will not be subject to the surcharge.
ADVERTISEMENT In an April 10 letter from Timothy Dobeck, Parma's Law Director, to FES which has now been filed with PUCO, Dobeck writes, "I am disappointed with FirstEnergy Solution's decision to pass that charge along to residential customers, including those in Parma. In my opinion, FirstEnergy Solutions (FES) has treated Parma residents unfairly."
"At the time we were negotiating an agreement with FES in 2009, the Parma Law Department requested language in the agreement stating, in effect, that 'no aggregator would receive a more favorable contract, and that in the event that it did, Parma would receive that same benefit that another aggregator received.' In fact, we met with you at your Akron offices to discuss this very point, FES declined the proposed language and advised us that this language was not necessary due to the fact that all aggregators had to sign identical agreements and that no aggregator would be allowed to deviate from the uniform agreement," Dobeck alleged.
"The reason Parma requested that parity language was to avoid the exact type of situation in which we now find ourselves," Dobeck wrote, noting press reports that NOPEC is not being charged the polar vortex surcharge.
"I certainly do not want to find Parma in a situation where we are subsidizing another aggregation group that is not being asked to pay the pass-through costs. Accordingly, please provide me with your methodology of how costs will be recovered by groups that are in a similar class as Parma versus groups that are not being charged the surcharge," Dobeck wrote
"Please consider that in 2009, FES representatives assured us that no aggregator would receive more favorable terms than the City of Parma, Parma never requested to be treated better than another aggregation group; we simply requested to be treated as well as any other group, FES assured us that this would be the case," Dobeck wrote
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April 18, 2014
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Copyright 2010-13 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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