Filings Under the Public Utility Holding Company Act of 1935, as Amended (“Act”), 53031-53033 [E5-4839]
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Federal Register / Vol. 70, No. 171 / Tuesday, September 6, 2005 / Notices
staff members who have an interest in
the matters may also be present.
The General Counsel of the
Commission, or his designee, has
certified that, in his opinion, one or
more of the exemptions set forth in 5
U.S.C. 552b(c)(3), (5), (7), (9)(B), and
(10) and 17 CFR 200.402(a) (3), (5), (7),
9(ii) and (10) permit consideration of
the scheduled matters at the Closed
Meeting.
Commissioner Nazareth, as duty
officer, voted to consider the items
listed for the closed meeting in closed
session.
The subject matters of the Closed
Meeting scheduled for Wednesday,
September 7, 2005, will be:
Formal orders of investigations;
Institution and settlement of
injunctive actions; and
Institution and settlement of
administrative proceedings of an
enforcement nature.
At times, changes in Commission
priorities require alterations in the
scheduling of meeting items.
For further information and to
ascertain what, if any, matters have been
added, deleted or postponed, please
contact:
The Office of the Secretary at (202)
551–5400.
Dated: August 31, 2005.
Jonathan G. Katz,
Secretary.
[FR Doc. 05–17660 Filed 8–31–05; 4:58 pm]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 35–28021]
Filings Under the Public Utility Holding
Company Act of 1935, as Amended
(‘‘Act’’)
August 30, 2005
Notice is hereby given that the
following filing(s) has/have been made
with the Commission pursuant to
provisions of the Act and rules
promulgated under the Act. All
interested persons are referred to the
application(s) and/or declaration(s) for
complete statements of the proposed
transaction(s) summarized below. The
application(s) and/or declaration(s) and
any amendment(s) is/are available for
13 17
CFR 240.11Aa3–2.
CFR 200.30–3(a)(29).
1 FirstEnergy’s other public utility subsidiaries
are Jersey Central Power & Light Company,
Pennsylvania Electric Company, Metropolitan
Edison Company, York Haven Power Company, The
Waverly Electric Power & Light Company and
American Transmission Systems, Incorporated.
14 17
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public inspection through the
Commission’s Branch of Public
Reference.
Interested persons wishing to
comment or request a hearing on the
application(s) and/or declaration(s)
should submit their views in writing by
September 26, 2005, to the Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–9303, and serve a copy on the
relevant applicant(s) and/or declarant(s)
at the address(es) specified below. Proof
of service (by affidavit or, in the case of
an attorney at law, by certificate) should
be filed with the request. Any request
for hearing should identify specifically
the issues of facts or law that are
disputed. A person who so requests will
be notified of any hearing, if ordered,
and will receive a copy of any notice or
order issued in the matter. After
September 26, 2005, the application(s)
and/or declaration(s), as filed or as
amended, may be granted and/or
permitted to become effective.
FirstEnergy Corp., et al. (70–10307)
FirstEnergy Corp., (‘‘FirstEnergy’’), a
registered holding company; its public
utility subsidiaries: Ohio Edison
Company, an Ohio corporation (‘‘Ohio
Edison’’); The Cleveland Electric
Illuminating Company, an Ohio
corporation (‘‘Cleveland Electric’’); The
Toledo Edison Company, an Ohio
corporation (‘‘Toledo Edison’’); and
Pennsylvania Power Company, a
Pennsylvania corporation and wholly
owned subsidiary of Ohio Edison,
(‘‘Penn Power’’), collectively, ‘‘Utility
Subsidiaries;’’ all of 76 South Main
Street, Akron, Ohio 44308, have filed an
application-declaration, as amended
(‘‘Application’’) under sections 9(a), 10
and 12(b) of the Act and rule 45 under
the Act. FirstEnergy and the Utility
Subsidiaries are referred to as
‘‘Applicants.’’ FirstEnergy directly owns
all of the outstanding common stock of
Ohio Edison, Cleveland Electric, Toledo
Edison, and indirectly through Ohio
Edison owns all of the outstanding
common stock of Penn Power’’.1
Ohio Edison was organized under the
laws of the State of Ohio in 1930 and
owns property and does business as an
electric public utility in that state. Ohio
Edison also has ownership interests in
certain generating facilities located in
the Commonwealth of Pennsylvania.
Ohio Edison engages in the generation,
distribution and sale of electric energy
to communities in a 7,500 square mile
area of central and northeastern Ohio
having a population of approximately
2.8 million.
Ohio Edison owns all of Penn Power’s
outstanding common stock. Penn Power
was organized under the laws of the
Commonwealth of Pennsylvania in 1930
and owns property and does business as
an electric public utility in that state.
Penn Power is also authorized to do
business and owns property in the State
of Ohio. Penn Power furnishes electric
service to communities in a 1,500
square mile area of western
Pennsylvania having a population of
approximately 300,000.
Cleveland Electric was organized
under the laws of the State of Ohio in
1892 and does business as an electric
public utility in that state. Cleveland
Electric engages in the generation,
distribution and sale of electric energy
in an area of approximately 1,700 square
miles in northeastern Ohio having a
population of approximately 1.9
million. It also has ownership interests
in certain generating facilities located in
Pennsylvania.
Toledo Edison was organized under
the laws of the State of Ohio in 1901
and does business as an electric public
utility in that state. Toledo Edison
engages in the generation, distribution
and sale of electric energy in an area of
approximately 2,500 square miles in
northwestern Ohio having a population
of approximately 800,000. It also has
interests in certain generating facilities
located in Pennsylvania.
Requested Authorization
Applicants request authorization for
certain transactions that are related to
the sale of their respective interests in
certain fossil-fuel and hydroelectric
generating facilities owned by the
Utility Subsidiaries to FirstEnergy
Generation Corp. (‘‘FE GenCo’’), which
is a direct wholly-owned subsidiary of
FirstEnergy Solutions Corp. (‘‘FE
Solutions’’) and an indirect subsidiary
of FirstEnergy. FE GenCo is an ‘‘exempt
wholesale generator’’ (‘‘EWG’’) under
Section 32 of the Act. These asset
transfers are in furtherance of
FirstEnergy’s Ohio and Pennsylvania
corporate separation plans, which were
described in FirstEnergy’s Application/
These companies are not applicants in this
proceeding.
2 The Utility Subsidiaries do not propose to
transfer their remaining percentage ownership
interests in certain fossil-fuel units that are not now
being leased by FE GenCo.
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Federal Register / Vol. 70, No. 171 / Tuesday, September 6, 2005 / Notices
Declaration for authorization to merge
with GPU, Inc. (‘‘GPU’’). See HCAR No.
27459 (October 29, 2001). Specifically,
the Utility Subsidiaries request
authority to acquire the secured
promissory notes from FE GenCo, as
described below.
The Utility Subsidiaries own,
individually or together as tenants in
common, interests in the following
fossil-fuel and hydroelectric generating
plants: 2
Ownership
(percent)
Plant
Location
MW
Ashtabula 5 ..........................................................
Bay Shore 1–4 .....................................................
Bay Shore Peaking ..............................................
R.E. Burger 3–5 ...................................................
R.E. Burger Peaking ............................................
Ashtabula, OH ......................................................
Toledo, OH ...........................................................
..............................................................................
Shadyside, OH .....................................................
Shadyside, OH .....................................................
244
631
17
406
7
Eastlake 1–5 ........................................................
Eastlake Peaking .................................................
Lakeshore 18 .......................................................
Lakeshore Peaking ..............................................
Bruce Mansfield 1 ................................................
Eastlake, OH ........................................................
..............................................................................
Cleveland, OH ......................................................
..............................................................................
Shippingport, PA ..................................................
1,233
29
245
4
780
Bruce Mansfield 2 ................................................
Shippingport, PA ..................................................
780
Bruce Mansfield 3 ................................................
Shippingport, PA ..................................................
800
W.H. Sammis 1–6 ................................................
W.H. Sammis 7 ....................................................
Stratton, OH .........................................................
Stratton, OH .........................................................
1,620
600
W.H. Sammis Peaking .........................................
Stratton, OH .........................................................
13
Edgewater Peaking ..............................................
Lorain, OH ............................................................
48
Richland Peaking 1–3 ..........................................
Seneca .................................................................
West Lorain Peaking Unit 1 .................................
Mad River Peaking ...............................................
Defiance, OH .......................................................
Warren, PA ..........................................................
Lorain, OH ............................................................
Springfield, OH .....................................................
42
435
120
60
Stryker Peaking ....................................................
Springfield, OH .....................................................
18
Cleveland Electric 100.
Toledo Edison 100.
Ohio Edison 100.
Ohio Edison 85.6.
Penn Power 14.4.
Cleveland Electric 100.
Cleveland Electric 100.
Ohio Edison 60.
Penn Power 33.5.
Ohio Edison 43.06.
Penn Power 9.36.
Cleveland Electric 1.68.
Ohio Edison 49.34.
Penn Power 6.28.
Ohio Edison 100.
Ohio Edison 48.
Penn Power 20.8.
Cleveland Electric 31.2.
Ohio Edison 85.6.
Penn Power 14.4.
Ohio Edison 86.
Penn Power 14.0.
Toledo Edison 100.
Cleveland Electric 100.
Ohio Edison 100.
Ohio Edison 85.6.
Penn Power 14.4.
Toledo Edison 100.
Currently, the Utility Subsidiaries
lease all of the fossil and hydroelectric
generating plants listed in the table
above to FE GenCo, which, as indicated,
has previously been certified by the
Federal Energy Regulatory Commission
(‘‘FERC’’) as an EWG.3 FE GenCo leases
and operates these plants pursuant to
the terms of a Master Facility Lease
(‘‘Master Lease’’), dated as of January 1,
2001 (incorporated by reference as
Exhibit B–1 to the Application).
Applicants state that the Master Lease,
which became effective on January 1,
2001, and has a term of twenty years,
was intended as the first step in the
eventual transfer of ownership of the
leased plants to FE GenCo. Pursuant to
Section 12 of the Master Lease, FE
GenCo has an option to purchase the
leased generating plants for the
purchase price per unit listed in
Exhibits A through D to the Master
Lease. Section 12 of the Master Lease
further provides that, upon exercise of
the purchase option, FE GenCo may pay
the purchase price either in cash or by
executing a promissory note, secured by
a lien on the transferred assets.
Each of the Utility Subsidiaries and
FE GenCo has entered into a Fossil
Purchase and Sale Agreement (‘‘Fossil
PSA’’), filed with this Application as
Exhibits B–2 through B–5. Under the
Fossil PSAs, FE GenCo has agreed to
purchase each Utility Subsidiary’s fossil
units (and, in the case of Cleveland
Electric, one hydroelectric generating
facility), and to assume certain
liabilities relating to the purchased
units, for an amount equal to the
aggregate purchase price for all units
owned by the selling Utility Subsidiary,
as set forth in Exhibits A through D of
the Master Lease, as follows: Ohio
Edison—$980 million; Penn Power—
$125 million; Cleveland Electric—$408
million; and Toledo Edison—$88
million. As consideration for the
purchased units, FE GenCo would
deliver to the selling Utility Subsidiary
its secured promissory note (‘‘FE GenCo
Note’’), filed with the Application as
Exhibits B–10 through B–13. Each FE
GenCo Note would be secured by a lien
on the units purchased, bear interest at
a rate per annum based on the average
weighted cost of long-term debt of the
Utility Subsidiary to which the FE
GenCo Note is issued, and mature
twenty years after the date of issuance.
FE GenCo may prepay the FE GenCo
Note at any time, in whole or in part,
without penalty.
The calculation of the average
weighted cost of long-term debt of each
of the Utility Subsidiaries as of March
31, 2005 is shown in Exhibit I to the
Application. The actual interest rate on
the FE GenCo Notes would be
calculated in the same manner as of the
end of the quarter next preceding the
closing date.
Under each Fossil PSA, FE GenCo has
also agreed that, upon request of the
selling Utility Subsidiary, it would
assume the selling Utility Subsidiary’s
liabilities and obligations with respect
2 The Utility Subsidiaries do not propose to
transfer their remaining percentage ownership
interests in certain fossil-fuel units that are not now
being leased by FE GenCo.
3 FE GenCo was approved by the FERC as an EWG
on April 6, 2001. FirstEnergy Generation Corp., 95
FERC ¶ 62,018 (2001).
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Federal Register / Vol. 70, No. 171 / Tuesday, September 6, 2005 / Notices
to certain outstanding pollution control
revenue bonds (‘‘PCRBs’’) that were
issued to finance pollution control
equipment related to the purchased
plants.4 If PCRB obligations are assumed
by FE GenCo at or prior to closing, then
the principal amount of the assumed
obligations would reduce the principal
amount of the applicable FE GenCo
Note delivered by FE GenCo at closing.
If FE GenCo assumes PCRB obligations
after closing, the principal amount
assumed would represent a payment of
principal on the applicable FE GenCo
Note delivered at closing.
For the Commission, by the Division of
Investment Management, pursuant to
delegated authority.
Jonathan G. Katz,
Secretary.
[FR Doc. E5–4839 Filed 9–2–05; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–52349; File No. SR–Amex–
2005–048]
Self-Regulatory Organizations;
American Stock Exchange LLC; Order
Approving Proposed Rule Change
Establishing a De Minimis Exception to
the 80/20 Test
August 26, 2005.
I. Introduction
On April 28, 2005, the American
Stock Exchange LLC (‘‘Amex’’ or
‘‘Exchange’’) filed with the Securities
and Exchange Commission
(‘‘Commission’’), pursuant to Section
19(b)(1) of the Securities Exchange Act
of 1934 (‘‘Act’’) 1 and Rule 19b–4
thereunder,2 a proposed rule change
seeking to amend Amex Rule 944 to
provide a de minimis exception to the
limitation on principal order access
imposed by the Plan for the Purpose of
Creating and Operating an Intermarket
Option Linkage (‘‘Linkage Plan’’) 3 and
related rules.
4 Currently, the Utility Subsidiaries have
outstanding obligations in respect of PCRBs in
approximately the following principal amounts:
Ohio Edison—$471 million; Penn Power—$63
million; Cleveland Electric—$362 million; and
Toledo Edison—$69 million.
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 On July 28, 2000, the Commission approved a
national market system plan for the purpose of
creating and operating an intermarket options
market linkage (‘‘Linkage’’) proposed by Amex,
Chicago Board Options Exchange, Inc., and
International Securities Exchange, Inc. See
Securities Exchange Act Release No. 43086 (July 28,
2000), 65 FR 48023 (August 4, 2000). Subsequently,
Philadelphia Stock Exchange, Inc., Pacific
Exchange, and Boston Stock Exchange, Inc. joined
VerDate Aug<18>2005
13:21 Sep 02, 2005
Jkt 205001
The proposed rule change was
noticed for comment in the Federal
Register on July 27, 2005.4 The
Commission received no comments on
the proposed rule change. This order
approves the proposed rule change.
II. Description
The purpose of this proposed rule
change is to implement proposed Joint
Amendment No. 17 to the Linkage Plan.
Joint Amendment No. 17, together with
this proposed rule change, would
establish a de minimis exception to the
‘‘80/20 Test’’ set forth in Section 8(b)(iii)
of the Linkage Plan and Amex Rule 944.
Section 8(b)(iii) of the Linkage Plan
provides that Eligible Market Makers
should send Principal Orders 5 through
the Linkage on a limited basis and not
as a primary aspect of their business.
The 80/20 Test implements this policy
in the Linkage Plan and Amex Rule 944
by prohibiting a specialist or registered
options trader (‘‘ROT’’) from sending
Principal Orders in an eligible option
class if, in the last calendar quarter, the
specialist or ROT’s Principal Order
contract volume is disproportionate to
the specialist or ROT’s contract volume
executed against customer orders in its
own market.
The Exchange believes that applying
the 80/20 Test has resulted in anomalies
for ROTs with limited volume in an
eligible option class. In particular, if a
ROT has very little overall trading
volume in an option, the execution of
one or two Principal Orders during a
calendar quarter could result in the ROT
failing to meet the 80/20 Test. This
would then prohibit the ROT from using
the Linkage to send Principal Orders in
that options class for the following
calendar quarter. The Exchange believes
that it is not the intention of the
Participants to the Linkage Plan to
prohibit ROTs with limited volume
from sending Principal Orders through
the Linkage in these circumstances
since such trading clearly is not ‘‘a
primary aspect of their business.’’
Accordingly, the proposed rule
change seeks to establish a de minimis
exception from the 80/20 Test in Amex
Rule 944 for specialists and ROTs that
have total contract volume of less than
1,000 contracts in an option class for a
calendar quarter.
the Linkage Plan. See Securities Exchange Act
Release Nos. 43573 (November 16, 2000), 65 FR
70851 (November 28, 2000); 43574 (November 16,
2000), 65 FR 70850 (November 28, 2000); and 49198
(February 5, 2004), 69 FR 7029 (February 12, 2004).
4 See Securities Exchange Act Release No. 52067
(July 20, 2005), 70 FR 43470.
5 A ‘‘Principal Order’’ is an order for the principal
account of an eligible market maker that does not
relate to a customer order the market maker is
holding. See Section 2(16)(b) of the Linkage Plan.
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53033
III. Discussion
After careful review, the Commission
finds that the proposed rule change is
consistent with the requirements of the
Act and the rules and regulations
thereunder applicable to a national
securities exchange. 6 In particular, the
Commission finds that the proposed
rule change is consistent with the
requirements of Section 6(b)(5) of the
Act 7 which requires, among other
things, that the rules of an exchange be
designed to promote just and equitable
principles of trade, to remove
impediments to and perfect the
mechanism of a free and open market,
and to protect investors and the public
interest. The Commission believes that
the proposed rule change will increase
the availability of Linkage to members
of the Participants by limiting the
applicability of the 80/20 Test in
situations where market makers have
minimal trading volume in a particular
options class.
The Commission recognizes that the
Exchange does not believe that it is
necessary to bar market makers with
limited volume from sending Principal
Orders through the Linkage, as such
trading does not raise concerns that a
member is sending such orders as ‘‘a
primary aspect of their business.’’ The
Commission believes that the de
minimis exemption from the 80/20 Test
proposed by the Exchange for market
makers that have a total contract volume
of less than 1,000 contracts in an
options class for a calendar quarter
should ensure that specialists and ROTs
with relatively low volume in a
particular options class can send a
reasonable number of Principal Orders
without being barred from using the
Linkage by application of the 80/20 Test
in the following calendar quarter.
IV. Conclusion
For the foregoing reasons, the
Commission finds that the proposed
rule change is consistent with the
requirements of the Act and the rules
and regulations thereunder.
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act,8 that the
proposed rule change (SR–Amex–2005–
048) is approved.
6 In approving this proposed rule change, the
Commission has considered the proposed rule’s
impact on efficiency, competition, and capital
formation. 15 U.S.C. 78c(f).
7 15 U.S.C. 78f(b)(5).
8 15 U.S.C. 78s(b)(2).
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]]>Agencies
[Federal Register Volume 70, Number 171 (Tuesday, September 6, 2005)]
[Notices]
[Pages 53031-53033]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E5-4839]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 35-28021]
Filings Under the Public Utility Holding Company Act of 1935, as
Amended (``Act'')
August 30, 2005
Notice is hereby given that the following filing(s) has/have been
made with the Commission pursuant to provisions of the Act and rules
promulgated under the Act. All interested persons are referred to the
application(s) and/or declaration(s) for complete statements of the
proposed transaction(s) summarized below. The application(s) and/or
declaration(s) and any amendment(s) is/are available for public
inspection through the Commission's Branch of Public Reference.
Interested persons wishing to comment or request a hearing on the
application(s) and/or declaration(s) should submit their views in
writing by September 26, 2005, to the Secretary, Securities and
Exchange Commission, 100 F Street, NE., Washington, DC 20549-9303, and
serve a copy on the relevant applicant(s) and/or declarant(s) at the
address(es) specified below. Proof of service (by affidavit or, in the
case of an attorney at law, by certificate) should be filed with the
request. Any request for hearing should identify specifically the
issues of facts or law that are disputed. A person who so requests will
be notified of any hearing, if ordered, and will receive a copy of any
notice or order issued in the matter. After September 26, 2005, the
application(s) and/or declaration(s), as filed or as amended, may be
granted and/or permitted to become effective.
FirstEnergy Corp., et al. (70-10307)
FirstEnergy Corp., (``FirstEnergy''), a registered holding company;
its public utility subsidiaries: Ohio Edison Company, an Ohio
corporation (``Ohio Edison''); The Cleveland Electric Illuminating
Company, an Ohio corporation (``Cleveland Electric''); The Toledo
Edison Company, an Ohio corporation (``Toledo Edison''); and
Pennsylvania Power Company, a Pennsylvania corporation and wholly owned
subsidiary of Ohio Edison, (``Penn Power''), collectively, ``Utility
Subsidiaries;'' all of 76 South Main Street, Akron, Ohio 44308, have
filed an application-declaration, as amended (``Application'') under
sections 9(a), 10 and 12(b) of the Act and rule 45 under the Act.
FirstEnergy and the Utility Subsidiaries are referred to as
``Applicants.'' FirstEnergy directly owns all of the outstanding common
stock of Ohio Edison, Cleveland Electric, Toledo Edison, and indirectly
through Ohio Edison owns all of the outstanding common stock of Penn
Power''.\1\
---------------------------------------------------------------------------
\1\ FirstEnergy's other public utility subsidiaries are Jersey
Central Power & Light Company, Pennsylvania Electric Company,
Metropolitan Edison Company, York Haven Power Company, The Waverly
Electric Power & Light Company and American Transmission Systems,
Incorporated. These companies are not applicants in this proceeding.
---------------------------------------------------------------------------
Ohio Edison was organized under the laws of the State of Ohio in
1930 and owns property and does business as an electric public utility
in that state. Ohio Edison also has ownership interests in certain
generating facilities located in the Commonwealth of Pennsylvania. Ohio
Edison engages in the generation, distribution and sale of electric
energy to communities in a 7,500 square mile area of central and
northeastern Ohio having a population of approximately 2.8 million.
Ohio Edison owns all of Penn Power's outstanding common stock. Penn
Power was organized under the laws of the Commonwealth of Pennsylvania
in 1930 and owns property and does business as an electric public
utility in that state. Penn Power is also authorized to do business and
owns property in the State of Ohio. Penn Power furnishes electric
service to communities in a 1,500 square mile area of western
Pennsylvania having a population of approximately 300,000.
Cleveland Electric was organized under the laws of the State of
Ohio in 1892 and does business as an electric public utility in that
state. Cleveland Electric engages in the generation, distribution and
sale of electric energy in an area of approximately 1,700 square miles
in northeastern Ohio having a population of approximately 1.9 million.
It also has ownership interests in certain generating facilities
located in Pennsylvania.
Toledo Edison was organized under the laws of the State of Ohio in
1901 and does business as an electric public utility in that state.
Toledo Edison engages in the generation, distribution and sale of
electric energy in an area of approximately 2,500 square miles in
northwestern Ohio having a population of approximately 800,000. It also
has interests in certain generating facilities located in Pennsylvania.
Requested Authorization
Applicants request authorization for certain transactions that are
related to the sale of their respective interests in certain fossil-
fuel and hydroelectric generating facilities owned by the Utility
Subsidiaries to FirstEnergy Generation Corp. (``FE GenCo''), which is a
direct wholly-owned subsidiary of FirstEnergy Solutions Corp. (``FE
Solutions'') and an indirect subsidiary of FirstEnergy. FE GenCo is an
``exempt wholesale generator'' (``EWG'') under Section 32 of the Act.
These asset transfers are in furtherance of FirstEnergy's Ohio and
Pennsylvania corporate separation plans, which were described in
FirstEnergy's Application/
[[Page 53032]]
Declaration for authorization to merge with GPU, Inc. (``GPU''). See
HCAR No. 27459 (October 29, 2001). Specifically, the Utility
Subsidiaries request authority to acquire the secured promissory notes
from FE GenCo, as described below.
The Utility Subsidiaries own, individually or together as tenants
in common, interests in the following fossil-fuel and hydroelectric
generating plants: \2\
---------------------------------------------------------------------------
\2\ The Utility Subsidiaries do not propose to transfer their
remaining percentage ownership interests in certain fossil-fuel
units that are not now being leased by FE GenCo.
----------------------------------------------------------------------------------------------------------------
Plant Location MW Ownership (percent)
----------------------------------------------------------------------------------------------------------------
Ashtabula 5........................ Ashtabula, OH........ 244 Cleveland Electric 100.
Bay Shore 1-4...................... Toledo, OH........... 631 Toledo Edison 100.
Bay Shore Peaking.................. ..................... 17
R.E. Burger 3-5.................... Shadyside, OH........ 406 Ohio Edison 100.
R.E. Burger Peaking................ Shadyside, OH........ 7 Ohio Edison 85.6.
Penn Power 14.4.
Eastlake 1-5....................... Eastlake, OH......... 1,233 Cleveland Electric 100.
Eastlake Peaking................... ..................... 29
Lakeshore 18....................... Cleveland, OH........ 245 Cleveland Electric 100.
Lakeshore Peaking.................. ..................... 4
Bruce Mansfield 1.................. Shippingport, PA..... 780 Ohio Edison 60.
Penn Power 33.5.
Bruce Mansfield 2.................. Shippingport, PA..... 780 Ohio Edison 43.06.
Penn Power 9.36.
Cleveland Electric 1.68.
Bruce Mansfield 3.................. Shippingport, PA..... 800 Ohio Edison 49.34.
Penn Power 6.28.
W.H. Sammis 1-6.................... Stratton, OH......... 1,620 Ohio Edison 100.
W.H. Sammis 7...................... Stratton, OH......... 600 Ohio Edison 48.
Penn Power 20.8.
Cleveland Electric 31.2.
W.H. Sammis Peaking................ Stratton, OH......... 13 Ohio Edison 85.6.
Penn Power 14.4.
Edgewater Peaking.................. Lorain, OH........... 48 Ohio Edison 86.
Penn Power 14.0.
Richland Peaking 1-3............... Defiance, OH......... 42 Toledo Edison 100.
Seneca............................. Warren, PA........... 435 Cleveland Electric 100.
West Lorain Peaking Unit 1......... Lorain, OH........... 120 Ohio Edison 100.
Mad River Peaking.................. Springfield, OH...... 60 Ohio Edison 85.6.
Penn Power 14.4.
Stryker Peaking.................... Springfield, OH...... 18 Toledo Edison 100.
----------------------------------------------------------------------------------------------------------------
Currently, the Utility Subsidiaries lease all of the fossil and
hydroelectric generating plants listed in the table above to FE GenCo,
which, as indicated, has previously been certified by the Federal
Energy Regulatory Commission (``FERC'') as an EWG.\3\ FE GenCo leases
and operates these plants pursuant to the terms of a Master Facility
Lease (``Master Lease''), dated as of January 1, 2001 (incorporated by
reference as Exhibit B-1 to the Application). Applicants state that the
Master Lease, which became effective on January 1, 2001, and has a term
of twenty years, was intended as the first step in the eventual
transfer of ownership of the leased plants to FE GenCo. Pursuant to
Section 12 of the Master Lease, FE GenCo has an option to purchase the
leased generating plants for the purchase price per unit listed in
Exhibits A through D to the Master Lease. Section 12 of the Master
Lease further provides that, upon exercise of the purchase option, FE
GenCo may pay the purchase price either in cash or by executing a
promissory note, secured by a lien on the transferred assets.
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\3\ FE GenCo was approved by the FERC as an EWG on April 6,
2001. FirstEnergy Generation Corp., 95 FERC ] 62,018 (2001).
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Each of the Utility Subsidiaries and FE GenCo has entered into a
Fossil Purchase and Sale Agreement (``Fossil PSA''), filed with this
Application as Exhibits B-2 through B-5. Under the Fossil PSAs, FE
GenCo has agreed to purchase each Utility Subsidiary's fossil units
(and, in the case of Cleveland Electric, one hydroelectric generating
facility), and to assume certain liabilities relating to the purchased
units, for an amount equal to the aggregate purchase price for all
units owned by the selling Utility Subsidiary, as set forth in Exhibits
A through D of the Master Lease, as follows: Ohio Edison--$980 million;
Penn Power--$125 million; Cleveland Electric--$408 million; and Toledo
Edison--$88 million. As consideration for the purchased units, FE GenCo
would deliver to the selling Utility Subsidiary its secured promissory
note (``FE GenCo Note''), filed with the Application as Exhibits B-10
through B-13. Each FE GenCo Note would be secured by a lien on the
units purchased, bear interest at a rate per annum based on the average
weighted cost of long-term debt of the Utility Subsidiary to which the
FE GenCo Note is issued, and mature twenty years after the date of
issuance. FE GenCo may prepay the FE GenCo Note at any time, in whole
or in part, without penalty.
The calculation of the average weighted cost of long-term debt of
each of the Utility Subsidiaries as of March 31, 2005 is shown in
Exhibit I to the Application. The actual interest rate on the FE GenCo
Notes would be calculated in the same manner as of the end of the
quarter next preceding the closing date.
Under each Fossil PSA, FE GenCo has also agreed that, upon request
of the selling Utility Subsidiary, it would assume the selling Utility
Subsidiary's liabilities and obligations with respect
[[Page 53033]]
to certain outstanding pollution control revenue bonds (``PCRBs'') that
were issued to finance pollution control equipment related to the
purchased plants.\4\ If PCRB obligations are assumed by FE GenCo at or
prior to closing, then the principal amount of the assumed obligations
would reduce the principal amount of the applicable FE GenCo Note
delivered by FE GenCo at closing. If FE GenCo assumes PCRB obligations
after closing, the principal amount assumed would represent a payment
of principal on the applicable FE GenCo Note delivered at closing.
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\4\ Currently, the Utility Subsidiaries have outstanding
obligations in respect of PCRBs in approximately the following
principal amounts: Ohio Edison--$471 million; Penn Power--$63
million; Cleveland Electric--$362 million; and Toledo Edison--$69
million.
For the Commission, by the Division of Investment Management,
pursuant to delegated authority.
Jonathan G. Katz,
Secretary.
[FR Doc. E5-4839 Filed 9-2-05; 8:45 am]
BILLING CODE 8010-01-P
