AKRON FirstEnergy struggles under scrutiny for blackout

FirstEnergy faces plenty of other problems besides the outage.
ASSOCIATED PRESS
It's been a bad month for FirstEnergy. The Akron-based owner of power lines that may have triggered the largest blackout in U.S. history was found guilty of pollution in early August, warned about its staggering $12.5 billion debt and forced to slash earnings estimates.
All this comes as the company is under close scrutiny for safety at its nuclear plant, which has been the subject of Congressional hearings and an investigation by the Nuclear Regulatory Commission.
The drain on the company's financing -- stemming mostly from clean-up of the shuttered nuclear plant near Toledo-- could make it harder for FirstEnergy to tackle any financial fallout from the outage.
Company officials said Sunday they would concentrate on the blackout investigation and not other problems.
According to a preliminary analysis, FirstEnergy -- which owns four of the first five lines that failed -- was experiencing unusual electric conditions as much as four hours before the blackout hit Thursday, sweeping across eight states and parts of Canada.
Alarm system
FirstEnergy said a system that is supposed to flash a red warning on computer monitors at the company's control center was not operational when the lines began failing Thursday afternoon.
The Akron-based company has 16 power plants and an annual revenue of more than $12 billion with customers along an area that stretches from Ohio to New Jersey.
Its Davis-Besse nuclear plant east of Toledo was shut in February 2002 for maintenance. A month later, it was discovered that boric acid ate through much of a 6-inch-thick steel cap on the plant's reactor vessel.
The company, awaiting a decision by the NRC before the plant can reopen, has been forced to purchase power elsewhere to make up for the halt in productivity at Davis-Besse. It has cost the company $450 million since July for repairs and replacement power.
Troubles at the plant also caught the attention of Congress and the Environmental Protection Agency.
List of problems
More problems began to pile up this summer.
On Aug. 7 a federal judge ruled that FirstEnergy violated pollution control laws when it rebuilt a power plant without installing state-of-the-art smog controls required under the Clean Air Act. A second trial will determine penalties.
The government argued the pollution from FirstEnergy and others winds up in the Northeast, where it causes acid rain and health problems.
Similar cases are pending against Columbus-based American Electric Power, Illinois Power Co., Duke Energy Corp. and Southern Co.
On the day of the court decision, Standard & amp; Poor's held FirstEnergy's credit rating one notch above junk status but said the company's outlook remains negative, and that long-term debt should be reduced to $10 billion by year-end.
In early August, FirstEnergy reported a second-quarter loss of $57.9 million, or 20 cents per share, due to special charges. FirstEnergy also said it would restate 2002 financial statements.