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): November 26, 1996
METROPOLITAN EDISON COMPANY
(Exact name of registrant as specified in charter)
Pennsylvania 1-446 23-0870160
(State or other (Commission (IRS employer
jurisdiction of file number) identification no.)
incorporation)
2800 Pottsville Pike, Reading, Muhlenberg Township, Berks County,
PA 19640-0001
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (610) 929-3601
ITEM 5. OTHER EVENTS.
On November 26, 1996, the Pennsylvania legislature approved
and sent to the Governor legislation providing for retail
electric competition. The Governor, who had supported the
legislation, is expected to sign the bill into law.
The legislation requires all Pennsylvania electric utilities
to submit restructuring plans to the Pennsylvania Public Utility
Commission ("PaPUC") by between April 1, 1997 and September 30,
1997. The plans must provide, among other things, for the phase-
in of retail customer choice beginning January 1, 1999 and ending
on January 1, 2001. In the interim, the PaPUC may order utilities
to implement retail access pilot programs beginning April 1,
1997. The legislation provides for the PaPUC to license or
certify all electric suppliers, including municipalities and
rural electric cooperatives furnishing service outside their
areas.
Utilities would be permitted to recover their prudently
incurred transition and stranded costs (including nuclear
decommissioning and spent nuclear fuel, non-utility generation
contract and other power plant investment costs) subject to
certain conditions (including an obligation to mitigate such
costs) through a PaPUC approved competitive transition charge
("CTC"). The CTC would be collectable for up to 9 years or such
other period approved by the PaPUC, and would be non-bypassable -
- that is, it would be payable by all customers, irrespective of
their electric supplier.
The legislation also includes provisions for the issuance of
"transition bonds" as a means for utilities to mitigate their
stranded and transition costs. Subject to PaPUC approval, a non-
bypassable intangible transition charge ("ITC") would be
collected from all utility customers. These ITC collections would
be used to pay principal and interest on the transition bonds.
Proceeds from the sale of transition bonds would be used by the
utility to reduce transition costs and related capitalization.
The benefit of the lower financing costs associated with the
transition bonds would be used by the utility to reduce customer
rates.
Finally, subject to certain exceptions, the legislation
imposes a 4-1/2 year rate cap on utility transmission and
distribution rates and a 9 year rate cap on electric generation
rates, in each case beginning January 1, 1997. Utilities may
obtain an exemption from the rate cap to provide for
extraordinary rate relief, non-utility generation contract
obligations, changes in law, required upgrades and repairs to
transmission and distribution facilities, increases in fuel and
purchased power costs, nuclear decommissioning costs and taxes.
A copy of GPU Energy's related news release is annexed as an
exhibit.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION
AND EXHIBITS.
(c) Exhibits.
1. GPU Energy News Release, dated November 26, 1996.
SIGNATURE
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE
ACT OF 1934, THE REGISTRANT HAS DULY CAUSED THIS REPORT TO BE
SIGNED ON ITS BEHALF BY THE UNDERSIGNED THEREUNTO DULY
AUTHORIZED.
METROPOLITAN EDISON COMPANY
By:______________________________
T.G. Howson, Vice President
and Treasurer
Date: December 2, 1996