Exhibit 2
Pennsylvania
Public Utility Commission
NEWS RELEASE
DATE: June 4, 1998
R-00974009 (OSA-237)
PUC Approves Penelec Restructuring Plan in Non-Binding Poll
The Public Utility Commission (PUC) today approved by a 4-0 vote, in a
non-binding poll, the restructuring plan for Pennsylvania Electric Company
(Penelec). Penelec is a subsidiary of GPU, Inc.
A final vote is scheduled for June 25.
Today's action, coupled with the previous PUC decisions on PECO Energy,
Duquesne Light Company, West Penn Power Company and PP&L creates the most
competitive electric market in the U.S.
New PUC Commissioner Aaron Wilson Jr. did not participate in today's
voting.
Under the plan approved today, Penelec will provide customers who shop
for their electricity a system average shopping credit of 3.73 cents per
kilowatt-hour beginning in January 1999. Shopping credits will vary from one
rate class to another and will increase over time to match anticipated increases
in the market price of generation. Assuming the market price in Penelec's
service territory is 3 cents, the Penelec plan will enable customers to reduce
bills in 1999 by about 10 percent.
The plan allows Penelec to collect approximately $858 million in
stranded costs over eight years, starting in January 1999, through a competitive
transition charge. In it's restructuring plan, Penelec had requested recovery of
$1.322 billion in stranded costs. Stranded costs are those costs incurred under
a regulated market which may not be recoverable in a competitive market. The
Electricity Generation Customer Choice and Competition Act of 1996 allows
utilities to collect stranded costs that the PUC finds to be just and
reasonable.
The PUC directed that one-third of Penelec's customers will be able to
buy power from the supplier of their choice on Jan. 1, 1999, another third on
Jan. 2, 1999, and the remainder on Jan. 2, 2000. In a recent separate action,
the PUC directed that open enrollment begin July 1, 1998, for customers
throughout the Commonwealth to choose their electric generation supplier.
Starting in 1999, Penelec will unbundle its rates to reflect separate
prices for the generation charge, the competitive transition charge, and
transmission and distribution charges. While generation will be open to
competition, Penelec will continue to provide transmission and distribution
services to its customers at PUC-regulated rates.
--MORE--
Today's action also significantly expands Penelec's funding of both the
Low Income Usage Reduction Program and its universal service program.
Penelec filed its initial restructuring plan on June 2, 1997.
Administrative Law Judge Allison K. Turner held public input hearings in Erie
and Johnstown and held seven technical hearings in Harrisburg. Turner issued a
recommended decision on May 7, 1998. Reading-based Penelec serves 575,000
customers in 32 northern and central Pennsylvania counties.
Eric Levis
Press Secretary
717/787-5722
(86)
GPU Restructuring
Kevin F. Cadden - Manager of Communications - 787-5722
Penelec and Met-Ed Rate Cuts
Rate Cuts for Shopping Customers - System Average
If the Generation Market Price is 3 cents/kwh rising at 3%,
rate cuts for shopping customers will be:
Penelec Met-Ed
------- ------
1999 10.02% 9.82%
2000 10.30% 10.09%
2001 10.50% 10.26%
2002 10.62% 10.37%
2003 10.66% 10.44%
2004 10.61% 10.42%
2005 10.48% 10.31%
2006 10.28% 10.11%
2007 20.29% 9.82%
2008 18.73% 9.35%
2009 17.12% 8.81%
Pennsylvania
Public Utility Commission
NEWS RELEASE
DATE: June 4, 1998
R-00974008 (OSA-236)
PUC Approves Met-Ed Restructuring Plan in Non-Binding Poll
The Public Utility Commission (PUC) today approved by a 4-0 vote, in a
non-binding poll, the restructuring plan for Metropolitan Edison Company
(Met-Ed). Met-Ed is a subsidiary of GPU, Inc.
A final vote is scheduled for June 25.
Today's action, coupled with the previous PUC decisions on PECO Energy,
Duquesne Light Company, West Penn Power Company and PP&L creates the most
competitive electric market in the U.S.
New PUC Commissioner Aaron Wilson Jr. did not participate in today's
voting.
Under the plan approved today, Met-Ed will provide customers who shop
for their electricity a system average shopping credit of 3.757 cents per
kilowatt-hour beginning in January 1999. Shopping credits will vary from one
rate class to another and will increase over time to match anticipated increases
in the market price of generation. Assuming the market price in eastern
Pennsylvania is 3 cents, the Met-Ed plan will enable customers to reduce bills
in 1999 by about 10 percent.
The plan allows Met-Ed to collect $975 million in stranded costs over
11 years, starting in January 1999, through a competitive transition charge. In
it's restructuring plan, Met-Ed had requested recovery of $1.475 billion in
stranded costs. Stranded costs are those costs incurred under a regulated market
which may not be recoverable in a competitive market. The Electricity Generation
Customer Choice and Competition Act of 1996 allows utilities to collect stranded
costs that the PUC finds to be just and reasonable.
The PUC directed that one-third of Met-Ed customers will be able to buy
power from the supplier of their choice on Jan. 1, 1999, another third on Jan.
2, 1999, and the remainder on Jan. 2, 2000. In a recent separate action, the PUC
directed that open enrollment begin July 1, 1998, for customers throughout the
Commonwealth to choose their electric generation supplier.
Starting in 1999, Met-Ed will unbundle its rates to reflect separate
prices for the generation charge, the competitive transition charge, and
transmission and distribution charges. While generation will be open to
competition, Met-Ed will continue to provide transmission and distribution
services to its customers at PUC-regulated rates.
--MORE--
Today's action also significantly expands Met-Ed's funding of both the
Low Income Usage Reduction Program and its universal service program.
Met-Ed filed its initial restructuring plan on June 2, 1997.
Administrative Law Judge Allison K. Turner held five public input hearings
throughout the company's service territory and held seven technical hearings in
Harrisburg. Turner issued a recommended decision on May 6, 1998.
The Reading-based Met-Ed serves 470,381 customers in all or portions of
14 eastern and southcentral counties.
Eric Levis
Press Secretary
717/787-5722
(87)
GPU Restructuring
Kevin F. Cadden - Manager of Communications - 787-5722
Penelec and Met-Ed Rate Cuts
Rate Cuts for Shopping Customers - System Average
If the Generation Market Price is 3 cents/kwh rising at 3%,
rate cuts for shopping customers will be:
Penelec Met-Ed
------- ------
1999 10.02% 9.82%
2000 10.30% 10.09%
2001 10.50% 10.26%
2002 10.62% 10.37%
2003 10.66% 10.44%
2004 10.61% 10.42%
2005 10.48% 10.31%
2006 10.28% 10.11%
2007 20.29% 9.82%
2008 18.73% 9.35%
2009 17.12% 8.81%