Form 8-K PPUC Nug Order
 

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported) August 18, 2006


Commission
File Number
  
Registrant; State of Incorporation;
Address; and Telephone Number
  
I.R.S. Employer
Identification No.
         
333-21011
  
FIRSTENERGY CORP.
  
34-1843785
   
(An Ohio Corporation)
    
   
76 South Main Street
    
   
Akron, OH 44308
    
   
Telephone (800) 736-3402
    
         
1-446
  
METROPOLITAN EDISON COMPANY
  
23-0870160
   
(A Pennsylvania Corporation)
    
   
c/o FirstEnergy Corp.
    
   
76 South Main Street
    
   
Akron, OH 44308
    
   
Telephone (800) 736-3402
    
         
1-3522
  
PENNSYLVANIA ELECTRIC COMPANY
  
25-0718085
   
(A Pennsylvania Corporation)
    
   
c/o FirstEnergy Corp.
    
   
76 South Main Street
    
   
Akron, OH 44308
    
   
Telephone (800) 736-3402
    






















Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2.):

[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))



Item 8.01 Other Events.

As previously disclosed, the Pennsylvania Public Utility Commission (PPUC) recently conducted a review and audit of the January 2006 modification to the Non-Utility Generation (NUG) purchased power stranded cost accounting methodology for Metropolitan Edison Company (Met-Ed) and Pennsylvania Electric Company (Penelec). The modification increased Met-Ed’s and Penelec’s deferred NUG cost balances by approximately $19.0 million and $6.2 million, respectively. On August 18, 2006, a PPUC Order was entered requiring Met-Ed and Penelec to reflect the deferred NUG cost balances as if the stranded cost accounting methodology modification had not been implemented in January 2006 and indicated that its Order is not intended to limit Met-Ed’s and Penelec’s ability to petition for a modification from the accounting methodology used between January 1999 and January 2006. All of Penelec’s incremental deferred NUG costs from the accounting methodology modification and approximately $8.7 million of Met-Ed’s incremental deferred NUG costs were incurred in periods prior to FirstEnergy’s acquisition of those companies in 2001 and were fully reserved upon implementation of the January 2006 modification. Therefore, as a result of the PPUC’s latest Order, FirstEnergy and Met-Ed will recognize a pre-tax charge of approximately $10.3 million (approximately $6.0 million after income taxes -- $0.02 per share of FirstEnergy common stock) in the third quarter of 2006. FirstEnergy, Met-Ed and Penelec continue to believe that the stranded cost accounting methodology modification implemented in January 2006 is appropriate and plan to petition the PPUC pursuant to its Order for authorization to reflect the stranded cost accounting methodology modification effective January 1, 1999. There can be no assurance, however, as to the timing or success of any such petition.
 
 
 
 
 
 
 
 
Forward-Looking Statements: This Form 8-K includes forward-looking statements based on information currently available to management. Such statements are subject to certain risks and uncertainties. These statements typically contain, but are not limited to, the terms "anticipate," "potential," "expect," "believe," "estimate" and similar words. Actual results may differ materially due to the speed and nature of increased competition and deregulation in the electric utility industry, economic or weather conditions affecting future sales and margins, changes in markets for energy services, changing energy and commodity market prices, replacement power costs being higher than anticipated or inadequately hedged, the continued ability to collect transition and other charges or to recover increased transmission costs, maintenance costs being higher than anticipated, legislative and regulatory changes (including revised environmental requirements), and the legal and regulatory changes resulting from the implementation of the Energy Policy Act of 2005 (including, but not limited to, the repeal of the Public Utility Holding Company Act of 1935), the uncertainty of the timing and amounts of the capital expenditures needed to, among other things, implement the Air Quality Compliance Plan (including that such amounts could be higher than anticipated) or levels of emission reductions related to the Consent Decree resolving the New Source Review litigation, adverse regulatory or legal decisions and outcomes (including, but not limited to, the revocation of necessary licenses or operating permits, fines or other enforcement actions and remedies) of governmental investigations and oversight, including by the Securities and Exchange Commission, the United States Attorney’s Office, the Nuclear Regulatory Commission and the various state public utility commissions as disclosed in the registrants’ Securities and Exchange Commission filings, generally, and with respect to the Davis-Besse Nuclear Power Station outage and heightened scrutiny at the Perry Nuclear Power Plant in particular, the timing and outcome of various proceedings before the Public Utilities Commission of Ohio (including, but not limited to, the successful resolution of the issues remanded to the PUCO by the Ohio Supreme Court regarding the Rate Stabilization Plan) and the Pennsylvania Public Utility Commission, including the transition rate plan filings for Met-Ed and Penelec, the continuing availability and operation of generating units, the ability of generating units to continue to operate at, or near full capacity, the inability to accomplish or realize anticipated benefits from strategic goals (including employee workforce initiatives), the anticipated benefits from voluntary pension plan contributions, the ability to improve electric commodity margins and to experience growth in the distribution business, the ability to access the public securities and other capital markets and the cost of such capital, the outcome, cost and other effects of present and potential legal and administrative proceedings and claims related to the August 14, 2003 regional power outages, the successful completion of the share repurchase program announced August 10, 2006, the risks and other factors discussed from time to time in the registrants’ Securities and Exchange Commission filings, including the registrants’ annual report on Form 10-K for the year ended December 31, 2005, and other similar factors. The registrants expressly disclaim any current intention to update any forward-looking statements contained herein as a result of new information, future events, or otherwise.

 

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SIGNATURE



Pursuant to the requirements of the Securities Exchange Act of 1934, each Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.



August 21, 2006


   
FIRSTENERGY CORP.
   
Registrant
     
   
METROPOLITAN EDISON COMPANY
   
Registrant
     
   
PENNSYLVANIA ELECTRIC COMPANY
   
Registrant
     
     
     
     
 
By:
/s/ Harvey L. Wagner
   
Harvey L. Wagner
   
Vice President, Controller and
   
Chief Accounting Officer


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