Penn Power Files Plan To Secure Electricity Supply at Set Rates

Oct. 11 /PRNewswire-FirstCall/ -- FirstEnergy Corp. announced today that its Pennsylvania Power Company subsidiary (Penn Power) filed a plan with the Pennsylvania Public Utility Commission (PUC) to secure electricity supply for its customers at set rates following the end of the transition period established for the company under the state's electric competition law. Under this law, Penn Power is required to secure generation supply for customers who do not choose alternative suppliers for their electricity.

In its plan, Penn Power is recommending that a Request for Proposal (RFP) process take place for electricity from third-party suppliers for the period of January 1, 2007, through May 31, 2008. The RFP process would be managed by an independent consultant.

"This plan, if approved by the PUC, would ensure that Penn Power customers have a secure supply of electricity at a price that will be set for a 17-month period," said Tom Clark, regional president for Penn Power. "We believe the RFP process is the best way to achieve the most competitive, market-based prices for generation."

The RFP would seek bids on approximately 900 megawatts of electricity in 18 increments of approximately 50 megawatts each. In order to help achieve the best possible pricing and to minimize the effects of any third-party supplier default, a single supplier would be limited to no more than 12 increments, or 600 megawatts of the total.

Under Pennsylvania's electric competition law, utility companies provided electricity supply at capped prices for customers who did not select alternative suppliers during an initial competitive transition period. Penn Power's transition period and rate caps will end December 31, 2006.

Regardless of a customer's generation supplier, Penn Power will continue to maintain reliable distribution service, read meters, and respond to customer inquiries. Penn Power serves approximately 160,000 customers in western Pennsylvania.

FirstEnergy is a diversified energy company headquartered in Akron, Ohio. Its subsidiaries and affiliates are involved in the generation, transmission and distribution of electricity, as well as energy management and other energy-related services. Its seven electric utility operating companies, including Penn Power, comprise the nation's fifth largest electric system, based on 4.4 million customers served within a 36,100-square-mile area of Pennsylvania, Ohio and New Jersey.

Forward-looking Statements: This news release 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 of our regulated utilities to collect transition and other charges, maintenance costs being higher than anticipated, legislative and regulatory changes (including revised environmental requirements), the uncertainty of the timing and amounts of the capital expenditures (including that such amounts could be higher than anticipated) or levels of emission reductions related to the settlement agreement 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 and the Nuclear Regulatory Commission as disclosed in our 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 availability and cost of capital, the continuing availability and operation of generating units, the ability of our generating units to continue to operate at or near full capacity, our inability to accomplish or realize anticipated benefits from strategic goals, our ability to improve electric commodity margins and to experience growth in the distribution business, our ability to access the public securities and other capital markets, the outcome, cost and other effects of present and potential legal and administrative proceedings and claims related to the August 14, 2003 regional power outage, the final outcome in the proceeding related to FirstEnergy's Application for a Rate Stabilization Plan (RSP) in Ohio, including, but not limited to, the Public Utilities Commission of Ohio's acceptance of the September 9, 2005 proposed supplement to the RSP, the risks and other factors discussed from time to time in our Securities and Exchange Commission filings, and other similar factors. FirstEnergy expressly disclaims any current intention to update any forward-looking statements contained herein as a result of new information, future events, or otherwise.