FirstEnergy Corp (NYSE:FE) Q3 2019 Earnings Conference Call - Final Transcript

Nov 04, 2019 • 09:00 am ET


FirstEnergy Corp (NYSE:FE) Q3 2019 Earnings Conference Call - Final Transcript


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Charles E. Jones

meeting or exceeding every commitment we have made, and I need to get the detailed planning in place before getting ahead of that process.

Now let's review our progress with our customer-focused growth strategies at our Utilities. In late August, each of our four Pennsylvania utilities filed new long-term infrastructure improvement plans or LTIPs for the 2020 through 2024 period. The filings outline our plans to invest $572 million over that time frame to accelerate infrastructure improvements and enhance service reliability for more than 2 million customers in Pennsylvania. These investments build on earlier improvement plans and included targeted projects that are designed to reduce the frequency of electric service interruptions for customers and shorten the duration of outages when they do occur.

Major initiatives will include replacing older infrastructure with new polls, overhead lines, underground cable, substation equipment, network vaults and manholes, reconfiguring circuits to minimize customers impacted by service interruptions and installing more advanced smart devices that can detect and isolate problems to help quickly restore power to impacted customers.

The work outlined in the LTIP programs accelerates infrastructure repairs, improvements and replacements, while also introducing new investments to enhance our distribution infrastructure and service reliability. We expect to recover the costs associated with the LTIP through the DISC Rider mechanism. We look forward to working with the Pennsylvania Public Utility Commission to have the plans approved by the end of the year, so work can begin in early 2020.

Before we move from Pennsylvania, on our last call, we mentioned that we were in discussions to transfer the responsibility for decommissioning Three Mile Island Unit-2 to a subsidiary of Energy Solutions LLC. This would remove any future nuclear decommission obligations from FirstEnergy and further simplify our regulated focus. In October, we signed that agreement, which includes transferring the plant, property, nuclear decommissioning trust and plant license as well as the associated liabilities and responsibility for decommissioning. While the agreement is subject to regulatory approvals, we expect transfer to take place around the second half of 2020.

Turning to Ohio. We are beginning to implement our $516 million three-year grid modernization program, which was approved by the Public Utilities Commission in July. We are laying the groundwork to begin construction on these projects during the first quarter of next year. Our investments include the installation of 700,000 smart meters and related infrastructure; building an advanced distribution management system in our Ohio Edison Illuminating Company and Toledo Edison service areas; following automated equipment on at least 200 distribution lines that can automatically isolate problems, prevent entire circuit outages and quickly restore electric service to customers; installing voltage regulating equipment on more than 200 circuits to provide energy efficiency benefits by optimizing voltage levels on the distribution grid. In addition, we have committed to developing time-varying rates that give customers the opportunity to reduce their monthly electric bill by using energy during off-peak periods.

Together, these modernization projects are expected to help reduce the number and duration of power outages