On April 27, at about 1:30 in the afternoon, a violent, hail-filled cold-front passed through town, knocking a tree branch onto a power line in a neighbor’s backyard. It knocked a pole-top transformer out of commission and caused a hyper-local power outage – about a dozen homes on the block.
The outage lasted 36 hours; I wrote about it on April 28. It required at least five separate work crews (and two visits by the fire department) to identify one of the more common line faults that a utility can have (even as helpful neighbors directed each crew to the precise location of the problem). It demonstrated FirstEnergy’s poor communication and an absence of advanced technologies that other utilities use.
The work I was doing that was interrupted by the power outage, ironically, involved research on the electrical engineering subspecialty of “fault detection, isolation and restoration” – helping utilities locate, shorten and minimize power outages just like this one.
From what I can gather, FirstEnergy is not a pioneer in this area.
The 2003 Northeast Blackout, which put 10 million people in the dark is attributed in large part to FirstEnergy:
But just listing links – from impartial sources and others (check out this one on the World Socialist Website) – that document FirstEnergy’s poor reliability record isn’t even good sport. They’re as easy to find as links for online gaming and cell phone plans.
My question is whether FirstEnergy is really incompetent, or if there is some larger plan.
In October 2009, FirstEnergy received federal stimulus money to undertake a smart meter pilot project in the Cleveland area. Smart meters – which have been rolling out across the country for the last decade – are considered an important tool in electric reliability and conservation. They provide consumers with real-time usage information, which helps people make their own decisions about how to manage their own electric use. They also have the add-on capability of communicating directly with the utility; so if an outage occurs at, say, the home of my elderly neighbor who depends on electricity to run her oxygen pump at night, FirstEnergy could know immediately.
Seven months after receiving the federal stimulus grant, FirstEnergy shelved the experiment due to money issues. The Public Utilities Commission of Ohio website now states FirstEnergy will install 5,000 smart meters beginning “spring 2011.” It doesn’t say precisely where, except that they will be in the old CEI service area.
Meanwhile, FirstEnergy has generated a lot of headlines in its effort to eliminate incentives for people whose homes are powered entirely by electricity. I guess it needs the revenue.
That’s understandable; FirstEnergy’s 2010 earnings (profit) were only slightly more than three-quarters of a billion dollars – which sounds like a lot of money until you understand the company had a pretty bad year, with profits declining 23% from $990 million in 2009.
Investors seem to have a love-hate relationship with FirstEnergy, as evidenced by this list of headlines from MotleyFool. One day it’s up, then next it’s a short sell, the next it’s failing you and the next it’s time to buy. I’m beginning to think that the only people who know less about what they’re doing than executives at FirstEnergy are investors in FirstEnergy.
Which isn’t fair, because it’s safe to safe that investors and executives alike are all better off in their relationship with FirstEnergy than I am.
FirstEnergy also has generated less-than-sparkling press for its “disastrous” program to deliver energy-efficient lightbulbs – as part of a federal initiative to help people reduce energy consumption. What has made the program so controversial, in part, has been FirstEnergy’s suggestion that it get paid for the power people don’t use as they learn to become more economical with their electricity.
So let’s add up the score:
- FirstEnergy is way behind in applying technology that would make service more reliable to consumers.
- It’s also way behind in technology that would help people conserve energy – which is closely related to reliability, since many power outages (like the infamous 2003 nightmare) occur during periods of peak demand.
- Its response to regulations that require it to help consumers conserve power is to distribute lightbulbs that you can buy anywhere – and then charge for the electricity saved.
- And for those consumers with all-electric homes – who are the most intensive household users of electricity – it’s saying that they need to pay more.
So its seems that FirstEnergy’s business philosophy (in my neighborhood anyway) can be summarized like this: Charge people as much as possible to consume as much electricity as they possibly can while providing the most inefficient and unsatisfactory service imaginable.
Clowns? Or an example of brilliant management? Let’s just agree that they have some really big shoes to fill.